Which of the Following Methods Involves Calculating an Average of the Beta

Multiple Choice

Which of the following methods involves calculating an average of the beta coefficients of numerous firms that are in the same (or a quite similar) line of business and then using that average beta coefficient to determine the appropriate required rate of return for a new capital budgeting project?

A) Sensitivity analysis method
B) Pure play method
C) Accounting beta method
D) Risk-adjusted method
E) Net present value (NPV) method