Question: Following are three independent projects Peanut/Pecan Processing (PPP) is evaluating: Project IRR Risk P 10.5 % Low Q 12.5 Average R 16.0 High PPP generally

Following are three independent projects Peanut/Pecan Processing (PPP) is evaluating:

Project	IRR	Risk
P	10.5	%	Low
Q	12.5		Average
R	16.0		High

PPP generally considers risk when examining projects by adjusting its average required rate of return, r, which equals 13 percent. A 4 percent adjustment is made for high-risk projects, and a 3 percent adjustment is made for low-risk projects. Which project(s) should PPP purchase? Round your answers to the nearest whole number.

Project	Risk-Adjusted r	Acceptable?
P	%
Q	%
R	%

Thus, what projects should be purchased.

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