Lasik Vision Inc

question 75

Multiple Choice

Lasik Vision Inc. recently analyzed the project whose cash flows are shown below. However, before Lasik decided to accept or reject the project, the Federal Reserve took actions that changed interest rates and therefore the firm's WACC. The Fed's action did not affect the forecasted cash flows. By how much did the change in the WACC affect the project's forecasted NPV? Note that a project's projected NPV can be negative, in which case it should be rejected.

• A) -$59.03
• B) -$56.08
• C) -$53.27
• D) -$50.61
• E) -$48.08

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Definitions:

Existential Import

A property of categorical propositions; a proposition has existential import if its truth depends on the existence of things of the kinds specified by terms in the proposition.

Contrary

Opposing or differing in nature, direction, or meaning; in logic, it refers to propositions that cannot both be true but can both be false.

Proposition

An articulation or statement that communicates a judgement or perspective.

Disproven

Shown to be false or incorrect through evidence or logical argument.