Swanson & Sons has two separate divisions. Each division is in a separate line of...
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Swanson & Sons has two separate divisions. Each division is in a separate line of business. Division A is the largest division and represents of the firm's overall sales. Division A is also the riskier of the two divisions. Division is the smaller and least risky of the two. When the company is deciding which of the various divisional projects should be accepted, they should:
a Allocate more funds to Division A since it is the larger of the two divisions.
b Fund all of Division Bs projects first since they tend to be less risky and then allocate the remaining funds to the Divisior A projects that have the highest net present values.
c Allocate the company funds to the projects with the highest net present values based on the firm's weighted average cost of capital.
d Assign different discount rates to each project and then select the projects with the highest net present values.
e fund the highest net present value projects from each division based on an allocation of of the funds to Division A and of the funds to Division B
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