Question: 4 . Project Evaluation a . Describe two methods of evaluating a project where future cash flows might be subject to inflation. b . Why

4. Project Evaluation
a. Describe two methods of evaluating a project where future cash flows might be subject to inflation.
b. Why might the use of a single company cost of capital to evaluate all projects lead to incorrect conclusions?
c. Explain how to use the CAPM to estimate a companys cost of capital if there is no debt.
d. How does your answer to c) change if the company borrows money?
e. Describe how to use the Certainty Equivalent method of calculating the NPV of a project.

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