LaPango Inc

question 93

Multiple Choice

LaPango Inc.estimates that its average-risk projects have a WACC of 10%,its below-average risk projects have a WACC of 8%,and its above-average risk projects have a WACC of 12%.Which of the following projects (A,B,and C) should the company accept?

• A) Project B,which is of below-average risk and has a return of 8.5%.
• B) Project C,which is of above-average risk and has a return of 11%.
• C) Project A,which is of average risk and has a return of 9%.
• D) None of the projects should be accepted.
• E) All of the projects should be accepted.

---

Definitions:

The CPU

The Central Processing Unit, which is the primary component of a computer that performs most of the processing inside a computer.

Data

Information that has been collected, organized, and can be interpreted or analyzed for various purposes.

Other Components

Additional parts, elements, or ingredients that are part of a larger system but not specified in the initial consideration.

Microcomputers

Small-sized computers that are powerful enough for individual use, including personal computers.