Farmer's Supply Is Considering Opening a Clothing Store, Which Would

Multiple Choice

Farmer's Supply is considering opening a clothing store, which would be a new line of business for the firm.Management has decided to use the cost of capital of a similar clothing store as the discount rate to evaluate this proposed expansion.Which one of the following terms describes this evaluation approach?

A) Equity approach
B) Aftertax approach
C) Subjective approach
D) Market play
E) Pure play approach