Which of the Following Statements About Project Risk Analysis in Not-For-

question 2

Multiple Choice

Which of the following statements about project risk analysis in not-for- profit firms is incorrect?

• A) The market risk of a project is not relevant to not-for-profit firms.
• B) A project's corporate beta measures the contribution of the project to the overall corporate risk of the firm.
• C) A project's corporate beta is found (at least conceptually) by regressing returns on the project against returns on the market portfolio.
• D) A project's corporate beta is defined as (\(\sigma\)P/\(\sigma\)F)rPF, where \(\sigma\)P is the standard deviation of the project's returns, \(\sigma\)F is the standard deviation of the firm's returns, and rPF is the correlation among the two sets of returns.
• E) In practice, it is usually difficult, if not impossible, to directly measure a project's corporate risk, so project risk analysis typically focuses on stand-alone risk.

---

Definitions:

Epicardium

The outermost layer of the heart wall, consisting of an inner visceral layer of the pericardium that protects and lubricates the heart.

Venous Cavity

A space within the body where deoxygenated blood is collected from the venous system before being returned to the heart.

Coronary Sinus

A large vein on the posterior of the heart that collects blood from the heart muscle (myocardium) and returns it to the right atrium.

Cardiac Vein

Blood vessels that drain deoxygenated blood from the myocardium (heart muscle) into the right atrium of the heart, playing a crucial role in the circulatory system.