$1$

Multiple Choice

$1$ point

Michel Inc. uses only equity capital, and it has $2$ equally$-$sized divisions. Division A$\text{'}$s cost of capital is $10\mathrm{.}0\%,$ Division B$\text{'}$s cost is $14\mathrm{.}0\%,$ and the composite WACC is $12\mathrm{.}0\%.$ All of Division A$\text{'}$s projects have the same risk, as do all of Division B$\text{'}$s projects. However, the projects in Division A have less risk than those in Division B$.$ Which of the following projects should Michel accept?