Your firm has a project with higher risk than your firms regular project. The project has been
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Question:
Your firm has a project with higher risk than your firm’s “regular” project. The project has been tentatively accepted for development, assuming a required rate of return of 12%. That required rate of return was estimated one year ago, before the FED began its interest rate hikes. The risk-free rate has increased by 2% from that used in the original projection.
Describe what you expect to happen to a project's expected NPV, and WHY
Related Book For
Foundations of Financial Management
ISBN: 978-1259024979
10th Canadian edition
Authors: Stanley Block, Geoffrey Hirt, Bartley Danielsen, Doug Short, Michael Perretta
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