Corner Jewelers,Inc A) -$5903
B) -$56

question 41

Multiple Choice

Corner Jewelers,Inc.recently analyzed the project whose cash flows are shown below.However,before the company decided to accept or reject the project,the Federal Reserve 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 expected NPV can be negative,in which case it should be rejected.
$$\begin{array} { l c c c c } \text { Old WACC: } & \text { 8.00\% } & \text { New WACC: } & 11.25 \% \\\text { Year } & 0 & 1 & 2 & 3 \\\text { Cash flows } & - \$1,000 & \$ 410 & \$ 410 & \$ 410\end{array}$$

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

---

Definitions:

Yearly Mammography

An annual screening process using X-ray imaging to detect breast cancer in women, recommended to start at a certain age or for those at higher risk.

Prostate Specific Antigen (PSA)

A protein produced by cells of the prostate gland, elevated levels of which can indicate prostate cancer or other conditions.

Chronic Fatigue

A persisting state of extreme tiredness and lowered energy levels not relieved by rest, often linked with chronic fatigue syndrome.

Symptom Analysis

The process of examining symptoms to determine their causes or to diagnose a condition.