Question: RiverRocks, whose WACC is 12.9%, is considering an acquisition of Raft Adventures (whose WACC is 14.9%). What is the appropriate discount rate for RiverRocks to

RiverRocks, whose WACC is

12.9%,

is considering an acquisition of Raft Adventures (whose WACC is

14.9%).

What is the appropriate discount rate for RiverRocks to use to evaluate the acquisition? Why?

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