LaPango Inc. estimates that its average-risk projects have a WACC of 10%, its below-average risk projects...

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LaPango Inc. estimates that its average-risk projects have a WACC of 10%, its below-average risk projects have a WACC of 8%, and its above-average risk projects have a WACC of 12%, which of the following projects (A, B, and C) should the company accept? O A. Project B, which is of below-average risk and has a return of 8.5%. O B. None of the projects listed in the choices should be accepted. C. Project C, which is of above-average risk and has a return of 11%. 0 D. Project A, which is of average risk and has a return of 9%. O E. All of the projects listed in the choices should be accepted.

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Answer 1

Answer #1

Option A Project B which is of below average risk and has a return of 8.5%

Each project's return will be compared against risk appropriate WACC

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Answer 2

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