Understanding risks that affect projects and the impact of risk consideration Yatta Net International has manufacturing, distribution, retail, and consulting divisions, Projects undertaken by the manufacturing and distribution divisions tend to be low-risk projects, because these divisions are well established and have predictable demand. The company started its retail and consuating divisions within the last year, and it is unknown if these divisions will be profitable. The company knew that opening these new divisions would be risky, but iss management believes the divisions have the potential to be extremely profisable under favorable market conditions. The company is currently using is Wacc to evaluate new projects for all divisions. If Yatta Net international does not risk-adjust its discount rate for specific projects properfy, which of the following is likely to occur over time? Check all that apply. The firm will become less valuable. The firm wili accept too many relativeiy sale projects The firm will accept too many relatively risky projects. How do managers typically deal with within-firm risk and beta risk when they are evaluating a potential project? Quantitatively Subjectively Consider the case of another company. Davis Prieting it evaluatiog two mutually exclusive projects. They both require a s5 milison investment today and have expected NPVs of 51,000,000, Management conducted a fult risk analysis of these two prajects, and the results are shown befiow Subjectively Consider the case of ancther company. Davis Printing is evaluating two mutually exclusive projects. They both require a $5 million investment today and have expected NPYs of $1,000,000. Management conducted a full risk analysis of these two projects, and the results are shown below. Which of the following statements about these projects' risk is correct? Check an that apply. Project A has more market risk than Project B. Project A has more corporate risk than Project B. Project B has more stand-alkne risk than Project A. Project B has more corporate risk than Project A