Question

please complete the remaining portions of the question. included extra pictures of answer choices to choose from so it is easier.

Answer 1

1. The beta coefficient the project represents the market risk.

Systematic Risk/Market risk:
1. Risk related to the economy.
2. Cannot be killed by diversification.

For Example:
1. Suppose a war is declared between two countries.
2. Government decisions / New political party coming into power.
3. Interest rate, Inflation fluctuation risk.

2. No, because the warehouse is a sunk cost.

The expenditure has already been incurred. There is no initial cash outflow due to it and hence it cannot be counted as an initial investment.
It does not affect the pricing decision of the project.

3. Environmental externality

It means uncompensated detrimental environmental effects due to the production of the company.