If a Firm Uses Its WACC as the Discount Rate

question 267

True/False

If a firm uses its WACC as the discount rate for all of the projects it undertakes, then the firm will tend to become riskier over time.

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Definitions:

Chlamydia Infection

A common sexually transmitted infection caused by the bacterium Chlamydia trachomatis, often asymptomatic.

Dysuria

Describes painful or difficult urination, which can be a symptom of urinary tract infections or other urological conditions.

Erythema

Redness of the skin caused by increased blood flow to the capillaries, often a sign of injury or inflammation.