Please highlight all answers Answer questions a and b for each project. Risk-adjusted discount...
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Answer questions a and b for each project.
Risk-adjusted discount rates-Basic Country Wallpapers is considering investing in one of three mutually exclusive projects, E, F, and G. The firm's cost of capital, r , is 14.8%, and the risk-free rate, RF, is 10.3%. The firm has gathered the following basic cash flow and risk index data for each project a. Find the net present value (NPV) of each project using the firm's cost of capital. Which project is preferred in this situation? b. The firm uses the following equation to determine the risk-adjusted discount rate, RADR, for each project j: Project (/) Initial investment (CFO) Year (t) $14,600 $11,000 $18,100 Cash inflows (CF) $5,800 5,800 5,800 5,800 1.81 $5,900 4,000 5,300 1,800 0.96 $4,200 5,800 8,600 12,800 0.63 Risk index (RI)
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