As a Financial Analyst,you Are Tasked with Evaluating a Capital

question 141

Multiple Choice

As a financial analyst,you are tasked with evaluating a capital budgeting project.You were instructed to use the IRR method and you need to determine an appropriate hurdle rate.The risk-free rate is 4 percent and the expected market rate of return is 11 percent.Your company has a beta of 1.0 and the project that you are evaluating is considered to have risk equal to the average project that the company has accepted in the past.According to CAPM,the appropriate hurdle rate would be ______%.

• A)4
• B)7
• C)15
• D)11
• E)1

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Definitions:

Chronic Obstructive Pulmonary Disease

A group of lung diseases that block airflow and make it difficult to breathe, including emphysema and chronic bronchitis.

Circulatory

Related to the circulatory system, which involves the heart and blood vessels, responsible for transporting nutrients, gases, and waste products throughout the body.

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An initial infection caused by inhaling the spores of the fungus Histoplasma capsulatum, often resulting in respiratory symptoms.

Histoplasmosis

A fungal infection caused by inhaling spores of the fungus Histoplasma capsulatum, often found in bird and bat droppings.