A Project with a Higher Than Average Risk Offers an Expected

question 57

Multiple Choice

A project with a higher than average risk offers an expected return of 18%.Which statement is correct if the company's opportunity cost of capital is 12% and the project's opportunity cost of capital is 15%?

• A)Project NPV is positive; it should be accepted.
• B)Project NPV is negative; it should be rejected.
• C)Project NPV is positive but it should be rejected.
• D)Project NPV is negative but it should be accepted.

---

Definitions:

Factitious Disorders

A mental disorder in which a person acts as if they have a physical or mental illness when they are not really sick, often done to gain attention or sympathy.

Psychological Stress

A form of stress experienced as a result of perceived pressures, conflicts, and demands that challenge an individual’s ability to cope, potentially affecting mental health.

Voluntary Control

The ability to consciously regulate one's own thoughts, feelings, or actions.

Conversion Disorder

A psychological condition in which emotional distress or unconscious conflict is expressed through physical symptoms without a medical cause.