1. Multidivisional companies with diverse operations should use an interest rate for discounting a specific division's estimated cash flows in capital budgeting that is representative of:
a. the riskiness of the specific division's cash flows.
b. the cost of capital obtained through the application of the pure play method.
c. Either b or c
d. the entire firm's cost of capital
2. When a similar company can't be found to use in estimating a divisional beta, the division's own records can sometimes be used instead. This method is called:
a. financial accounting.
b. pure play.
c. CAPM.
d. accounting beta