Which set of projects would maximize shareholder wealth

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Reference no: EM13286093

XYZ Inc. has an overall (composite) WACC of 10%, which reflects the cost of capital for its average asset. Its assets vary widely in risk. XYZ evaluates low-risk projects with a WACC of 8%, average projects at 10%, and high-risk projects at 12%. The company is considering the following projects:

Project Risk Expected Return

A High 15%
B Average 12%
C High 11%
D Low 9%
E Low 6%

Which set of projects would maximize shareholder wealth?

Reference no: EM13286093

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