A Company with an ROIC of 45 Percent and a Cost

Multiple Choice

A company with an ROIC of 45 percent and a cost of capital of 8 percent is considering an investment opportunity of similar risk to its existing investments.If the new opportunity would generate a 30 percent ROIC,what should the company do?

A) The company should invest in this project,as 30 percent is pretty close to the 45 percent that the company currently achieves.
B) The company should not invest in the project,since the return is lower than its current return of 45 percent.
C) The company should invest in the project,as its return is greater than the cost of capital.
D) The company should not invest in the project,since it already enjoys a high ROIC and the new investment will dilute the overall returns.