If a fiRm Uses Its WACC as the Discount Rate

question 35

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.

---

Definitions:

Ecosystem

A biological community of interacting organisms and their physical environment.

Primary Consumers

Organisms that feed on primary producers; they are usually herbivores that eat plants and algae.

Green Plants

Photosynthetic, plant organisms that contain chlorophyll and produce oxygen as a byproduct of photosynthesis.

Herbivores

Animals that primarily eat plants or plant-based materials.