Riskier Projects Should Be Harder to Accept Than Others with Similar

Multiple Choice

Riskier projects should be harder to accept than others with similar cash flows. This is accomplished by:

A) Using higher discount rates which will lower the NPV of the project.
B) Using lower discount rates which will lower the NPV of the project.
C) Using higher discount rates which will increase the NPV of the project.
D) Using lower discount rates which will increase the NPV of the project.