Suppose a firm estimates its WACC to be 10%. Should the WACC be used to evaluate all

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Suppose a firm estimates its WACC to be 10%. Should the WACC be used to evaluate all of its potential projects, even if they vary in risk? If not, what might be “reasonable” costs of capital for average-, high-, and low-risk projects?

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Fundamentals of Financial Management

ISBN: 978-0324664553

Concise 6th Edition

Authors: Eugene F. Brigham, Joel F. Houston

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Question Posted: Oct 05, 2011 09:32 AM

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Suppose a firm estimates its WACC to be 10%. Should the WACC be used to evaluate all

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Fundamentals of Financial Management

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