What Decision Should Be Made on a Project of Above-Average

question 11

Multiple Choice

What decision should be made on a project of above-average risk if the project's IRR exceeds the WACC?

• A)accept the project; NPV is positive.
• B)reject the project; NPV is negative.
• C)decide after discounting at the IRR.
• D)decide after discounting at an appropriate rate.

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Definitions:

OCB

Organizational Citizenship Behavior, which represents voluntary, extra-role activities performed by employees that contribute to organizational effectiveness.

Trust

A psychological state in which one has a willingness to be vulnerable and to take risks with respect to the actions of another party.

Transformational Leadership

A leadership style where leaders inspire and motivate followers to exceed expectations and foster significant change.

LMX Differentiation

The degree to which there are variations in the quality of relationships between leaders and different members within the same team or organization.