Low-risk project in yogurt division


Dandy Product's overall weighted average required rate of return is 9 percent. Its yogurt division is riskier than average, its fresh produce division has average risk, and its institutional foods division has below-average risk. Dandy adjusts for divisional by adding or subtracting 2 percentage points and project risk by adding or subtracting 4 percentage points. Thus, the maximum adjustment is 2 + 4 percentage points. What is the risk adjusted required rate of return for a low-risk project in the yogurt division?

Request for Solution File

Ask an Expert for Answer!!
Finance Basics: Low-risk project in yogurt division
Reference No:- TGS049017

Expected delivery within 24 Hours