Question: 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

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 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. ANSWER "-$14.14"

I know the answer $14.14 please help me solve this with step by step using a financial calculator.

Year 0 1 2 3
Cash Flows $-700 $500 $500 $500

Please do not help using EXCEL because I am not allowed to use EXCEL.

Old WACC: 8.00%

New WACC: 8.75%

OLD=$56.61

NEW NPV $42.47

(56.61-42.47 )CHANGE=-$14.14

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