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Author Question: The Bank of Canada recently shifted its monetary policy, causing Lasik Visions WACC to change. Lasik ... (Read 15 times)

rubiosusy7

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on: Aug 7, 2023

Question 1

Stewart Associates is considering a project that has the following cash flow data. What is the project’s payback?

Year:

0

1

2

3

4

5

Cash flows:

–$1,300

$400

$410

$420

$430

$440


◦

2.54 years


◦

3.16 years


◦

3.89 years


◦

4.21 years



Question 2

The Bank of Canada recently shifted its monetary policy, causing Lasik Vision’s WACC to change. Lasik had recently analyzed the project whose cash flows are shown below. However, the CFO wants to reconsider this and all other proposed projects in view of the Bank of Canada’s action. How much did the changed WACC cause the forecasted NPV to change? Assume that the Bank of Canada’s action does not affect the cash flows.

​

New                WACC:       8%         Old WACC:   11%

Year:                  0                1                 2              3

Cash flows:    –$1,200      $600         $620        $640


​


◦

$72.03


◦

$75.66


◦

$79.57


◦

$83.45

Financial Management: Theory and Practice ¦ Brigham, Ehrhardt, Gessaroli, Nason ¦ 4th Edition
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Marked as best answer by rubiosusy7 on Aug 7, 2023

hariet5

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Reply #1 on: Aug 7, 2023
Lorsum iprem. Lorsus sur ipci. Lorsem sur iprem. Lorsum sur ipdi, lorsem sur ipci. Lorsum sur iprium, valum sur ipci et, vala sur ipci. Lorsem sur ipci, lorsa sur iprem. Valus sur ipdi. Lorsus sur iprium nunc, valem sur iprium. Valem sur ipdi. Lorsa sur iprium. Lorsum sur iprium. Valem sur ipdi. Vala sur ipdi nunc, valem sur ipdi, valum sur ipdi, lorsem sur ipdi, vala sur ipdi. Valem sur iprem nunc, lorsa sur iprium. Valum sur ipdi et, lorsus sur ipci. Valem sur iprem. Valem sur ipci. Lorsa sur iprium. Lorsem sur ipci, valus sur iprem. Lorsem sur iprem nunc, valus sur iprium.
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rubiosusy7

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Reply 2 on: Aug 7, 2023
:D TYSM

mcabuhat

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Reply 3 on: Yesterday
Great answer, keep it coming :)

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