The Use of WACC as the Discount Rate When Evaluating

Multiple Choice

The use of WACC as the discount rate when evaluating a project is acceptable when the

A) company is well established and financially stable.
B) WACC produces a positive NPV.
C) risk of the project is equal to the company's overall level of risk.
D) company is well diversified and the unsystematic risk is negligible.
E) project has only systematic risk.