To Calculate the Adjusted Present Value, You

question 18

Multiple Choice

To calculate the adjusted present value, you:

• A) multiply the additional effects by the all equity project value.
• B) add the additional effects of financing to the all equity project value.
• C) divide the project's cash flow by the risk-free rate.
• D) divide the project's cash flow by the risk-adjusted rate.
• E) add the risk-free rate to the market portfolio when B equals 1.