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    Principles of Corporate Finance Study Set 5
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    Exam 9: Risk and the Cost of Capital
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    The Risk-Free Rate Is 5%, the Market Risk Premium Is
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The Risk-Free Rate Is 5%, the Market Risk Premium Is

Question 11

Question 11

Multiple Choice

The risk-free rate is 5%, the market risk premium is 8% and the project's beta is 1.25. Calculate the certainty equivalent cash flow for
Year-3.


A) $228.35
B) $197.25
C) $300
D) None of the above

Correct Answer:

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