Which of the following statements about project standing alonerisk is true? a. I

Question

Which of the following statements about project standing alonerisk is true?
a. It ignores the fact that much of the risk of a project willbe diversified away as the project is combined with the firm'sother projects. b. It ignores the cash flows that are associated with aproject that occur beyond the payback period. c. It takes into consideration the effects of diversificationof the firm's shareholders. d. None of the above Which of the following statements about project standing alonerisk is true?
a. It ignores the fact that much of the risk of a project willbe diversified away as the project is combined with the firm'sother projects. b. It ignores the cash flows that are associated with aproject that occur beyond the payback period. c. It takes into consideration the effects of diversificationof the firm's shareholders. d. None of the above

Explanation / Answer

a. It ignores the fact that much of the risk of aproject will be diversified away as the project is combined withthe firm's other projects. b. It ignores the cash flows that are associated with aproject that occur beyond the payback period. c. It takes into consideration the effects of diversificationof the firm's shareholders. d. None of the above

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