Piedmont Hotels is an all-equity company. Its stock has a beta of 1.33. The market risk premium is 7.4 percent and the risk-free rate is 3.2 percent. The company is considering a project that it considers riskier than its current operations so it wants to apply an adjustment of 2.4 percent to the project's discount rate. What should the firm set as the required rate of return for the project?

Q: None

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Production Budget

A budget can be defined as a financial plan designed by an undertaking for a definite period in the future that can contribute towards enhancing the financial success of the business undertaking. It is used to estimate the revenue and expenses. The budget generally takes into account both current and future income and expenses.