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Dandy Product's overall weighted average required rate of return is 8 percent. Its yogurt division...

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Accounting

Dandy Product's overall weighted average required rate of return is 8 percent. Its yogurt division is riskier than average, its fresh produce division has average risk, and its institutional foods division has below-average risk. Dandy adjusts for divisional by adding or subtracting 1 percentage points and project risk by adding or subtracting 1 percentage points. Thus, the maximum adjustment is 1 + 1 percentage points. What is the risk adjusted required rate of return for a low-risk project in the yogurt division?

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