Question: Where will the following projects plot in relation to the security market line if the risk-free rate is 6% and the market premium is 9%?

Where will the following projects plot in relation to the security market line if the risk-free rate is 6% and the market premium is 9%? Which projects should be undertaken?

Project Beta IRR

A 2.0 25%

B 1.6 22%

C 1.1 15%

D 0.8 11%

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