The Subjective Approach to Determining Risk-Adjusted Discount Rates _____

The subjective approach to determining risk-adjusted discount rates _____.

A) uses the risk-free rate for average-risk projects
B) explicitly considers the probability distribution of a project's cash flows
C) always leads to the correct investment decisions
D) groups projects into risk classes and evaluates all projects in a particular risk class at the same risk-adjusted discount rate

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