If a firm applies its overall cost of capital to all its proposed proj

If a firm applies its overall cost of capital to all its proposed projects, then the divisions within the firm will tend to:

A) receive more funding if they represent the riskiest operations of the firm.
B) avoid risky projects so that they will receive more funding.
C) become less risky over time based on the projects that are accepted.
D) have equal probabilities of receiving funding for their projects.
E) propose less risky projects than if separate discount rates were applied to each project.

ANSWER

A