part a. b. c. d.

P11-24 (similar to) Question Help ewa Risk-adjusted discount rates Basic Country Wallpapers is considering investing in one of three mutually exclusive projects, E, F, and G. The firm's cost of capital 1, is 15.15, and the risk-free rate, Re, is 9.5%. The firm has gathered the following basic cash flow and risk index data for each project a. Find the net present value (NPV) of each project using the firm's cost of capital. Which project is preferred in this situation? b. The firm uses the following equation to determine the risk-adjusted discount rate, RADR for each project nts RADR = R + RI* (-R) esti SCOP where Re = risk-free rate of retum, RI = risk index for project and cost of capital c. Use the RADR for each project to determine its nisk-adjusted NPV Which project is preferable in this situation? d. Compare and discuss your findings in parts (a) and (c) Which project do you recommend that the firm accept? ber a. Find the net present value (NPV) of each project using the firm's cost of capital The net present value for project is Round to the nearest cent) 9 of 10 (4 complete) HWS Data Basic Country Wallpapers is considering investing in one of three mutually exclusive projects, e, RF, is 9.5%. The firm has gathered the following basic cash flow and risk index data for each project PV) of each project using the firm's cost of capital. Which project is preferred in this situation? Data Table (Click on the icon located on the top-right corner of the data table below in order to copy its contents into a spreadsheet.) $14,000 Initial investment (CF) Year(t) Project ( ) F G $11,000 $19,700 Cash inflows (CF) $6,500 $4,000 4,400 5,600 4,800 7,000 2.500 12,500 1.04 $6,300 6,300 6,300 6,300 1.78 Risk index (RI) 0.63 Print Done ver box and then click Check