WestJet Airlines Is Considering Purchasing 20 New Planes That Will

question 73

Multiple Choice

WestJet Airlines is considering purchasing 20 new planes that will save the company $25 million per year in fuel and maintenance costs for the next 10 years.If the cost of the new planes is $200 million dollars and WestJet's WACC is 8.5%,what is the NPV of the project?

• A)-$200,000
• B)$50 million
• C)$30.4 million
• D)$0
• E)$4.4 million

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Definitions:

Lewis Structure

A diagram that shows the bonding between atoms of a molecule and the lone pairs of electrons that may exist in the molecule.

Ethane

A colorless, odorless gas that is a hydrocarbon of the alkane series, used as a fuel and in chemical synthesis.

Lewis Structure

A representation that illustrates how atoms in a molecule bond and highlights any unshared electron pairs that might be present.

Lewis Structure

A visual diagram that illustrates the bonding between atoms and the lone pairs of electrons in a molecule.