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Capital budgeting decisions and enterprise cost

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In Week #3, we studied capital budgeting and the use of an implied interest rate (cost of capital) is key in the net present value (NPV) model. In Week #4 and this week, we studied how to compute the cost of capital for an enterprise. Please write at least three well composed paragraphs that discuss the connection between capital budgeting decisions and the enterprise's cost of capital. Would an enterprise ever decide to embark on a project whose rate of return would be less than its cost of capital? Why or why not?

Reference no: EM133254170

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