Plimoth Plantation's overall WACC is 11%. It has an opportunity to accept a project that involves nearly riskless cash flows, but will earn only 7%. This project will require a significant portion of the firm's capital. If Plimoth accepts this project,

• the value of the company will fall because it's WACC will fall. 
• the value of the company will fall because it's average rate of return on investments will fall. 
• the value of the company will rise because its WACC will fall. 
• both it's average rate of return and its WACC should fall.

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