Risk in a Revenue-Producing Project Can Best Be Adjusted for by

Multiple Choice

Risk in a revenue-producing project can best be adjusted for by

A) Ignoring it.
B) Adjusting the discount rate upward for increasing risk.
C) Adjusting the discount rate downward for increasing risk.
D) Picking a risk factor equal to the average discount rate.
E) Reducing the NPV by 10 percent for risky projects.