Multiple Choice
What is the best approach to take into account of the relative risk of a proposed project?
A) adjusting the discount rate upward if the project is judged to have above-average risk
B) reducing the NPV by 10% for risky projects
C) picking a risk factor equal to the average discount rate
D) ignoring risk because project risk cannot be measured accurately
Correct Answer:
Verified
Correct Answer:
Verified
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