Question & Answer: The discount rate for a project should equal the:…..

The discount rate for a project should equal the:

Select one:

a. cost of equity of the firm.

b. expected return on a financial asset of comparable risk.

c. market rate of return.

d. firm’s weighted average cost of capital. Incorrect

e. discount rate used on the firm’s last profitable project

Expert Answer

 

The discount rate for a project should equal the cost of equity of the firm
Option A is correct
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