Which of the Following Statements Is FALSE

question 15

Multiple Choice

Which of the following statements is FALSE?

• A)The Capital Asset Pricing Model is the most important method for estimating the cost of capital that is used in practice.
• B)Because the risk that determines expected returns is unsystematic risk,which is measured by beta,the cost of capital for an investment is the expected return available on securities with the same beta.
• C)A common assumption is that the project has the same risk as the firm.
• D)To determine a project's cost of capital we need to estimate its beta.

---

Definitions:

Rooting

An instinctual reflex in newborns, where touching the cheek leads to the baby turning their head and opening the mouth to facilitate breastfeeding.

Grasping

Grasping is the act of taking hold of something firmly with the hands or arms.

Sucking

Describes a natural reflex for babies used for feeding and comfort, which is essential for their survival.

Assimilating

The process of taking in and fully understanding information or ideas, often used in the context of integrating into a new cultural or social environment.