1. For a multi-product firm, if a project's beta is
different from that of the overall firm, then the:
A. CAPM can no longer be used.
B. project should be discounted using the overall firm's
beta.
C. project should be discounted at a rate commensurate with
its own beta.
D. project should be discounted at the market rate.
E. project should be discounted at the T-bill rate.
2. Your mother helped you start saving $25 a month
beginning on your 10th birthday. She always made
you make your deposit on the first day of each month just to "start
the month out right." Today, you turn 21 and have $4,482.66 in your
account. What is the annual rate of return on your
savings?
A. 5.25%
B. 5.29%
C. 5.33%
D. 5.36%
E. 5.50%
1. For a multi-product firm, if a project's beta is different from that of the overall firm, then the: A. CAPM can no l
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