2 2 Project Beta IRR W 57 10.0 % X .93 10.5 Y 1.13 14.0 Z 1.70 17.0 The T-bill rate is 4.5 percent, and the expected return on the market is 13 percent. a. Compared with the firm's 12 percent cost of capital, Project W has a expected return, Project X has a expected return, Project Y has a expected return, and Project Z has a expected return. b. Project W should be Project X should be Project Y should and Project Z should be be c. If the firm's overall cost of capital were used as a hurdle rate, Project W would be Project X would be Projects Y would be and Project Z would be