A Firm Is Considering Expanding Its Current Operations and Has

question 17

Multiple Choice

A firm is considering expanding its current operations and has determined the internal rate of return on that expansion is 12.2%. The firm's WACC is 11.8%. Given this, you know the:

• A) project will have a lower debt-equity ratio than the firm's current operations.
• B) appropriate discount rate for the project is between 11.8% and 12.2%.
• C) project has slightly more risk than the firm's current operations.
• D)expansion should be undertaken as it has a positive net present value.

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Definitions:

Motivational Practices

Strategies or actions taken to encourage and boost the motivation levels of individuals or groups.

Diagnosis

The process of identifying and understanding a problem, condition, or situation by analyzing its symptoms or characteristics.

Needs

Essential requirements or necessities for physical, psychological, or social well-being and growth.

Motivational Practices

Techniques and strategies used by organizations to inspire, encourage, and boost the motivation of their employees.