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Which project should be accepted

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Wagner 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?

a) Project A is of average risk and has a return of 9%.

b) Project B is of below-average risk and has a return of 8.5%.

c) Project C is of above-average risk and has a return of 11%.

d) None of the projects should be accepted.

e) All of the projects should be accepted.

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The solution explains which project should be accepted given the WACC and return from the project

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