What might be reasonable costs of capital for average

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Suppose a firm estimates its WACC to be 10%. Should the WACC be used to evaluate all of its potential projects, even if they vary in risk? If not, what might be “reasonable” costs of capital for average-, high-, and low-risk projects?

a. Would the savings and loans have higher profits in a world with a “normal” or an inverted yield curve? Explain your answer.

Reference no: EM131308946

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