Which of These May Occur If a Company Uses Its

question 80

Multiple Choice

Which of these may occur if a company uses its overall cost of capital as the discount rate for all projects? I.Profitable low-risk projects may be incorrectly rejected.
II) Only projects with risks similar to the current company will be accepted.
III) Too many high-risk projects may be accepted.
IV) Only low-risk projects will be accepted.

• A)II only
• B)II and IV only
• C)I and III only
• D)I and IV only
• E)I,II,and III only

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Definitions:

Task Maturity

Refers to the level of ability and willingness of an individual or group to effectively complete a specific task or job.

Attitudes

A settled way of thinking or feeling about someone or something, typically reflected in a person's behavior.

Satisfaction

The feeling of contentment or pleasure when one's wants, needs, or expectations are fulfilled.

Personal Problems

Challenges or issues that directly affect an individual, often relating to personal relationships, health, or emotional well-being.