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Consider GooG, a conglomerate with many divisions. If GooG uses the overall firm weighted average...

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Finance

Consider GooG, a conglomerate with many divisions. If GooG uses the overall firm weighted average cost of capital (wacc) as the hurdle rate for all divisions, would the riskier or the more conservative division tend to get most of the investment projects?

A. The more conservative division tends to get most of the investment projects.

B. The hurdle rate has nothing to do with selection of investment projects.

C. The trade-off between risk and return of the investment projects will determine the division which would get most of the projects. D. The riskier division tends to get most of the investment projects.

E. None of the above

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