Question: Western Shores is considering a project that has an initial cost today of $12,500. The project has a two-year life with cash inflows of $7,400

Western Shores is considering a project that has an initial cost today of $12,500. The project has a two-year life with cash inflows of $7,400 a year. Should the firm opt to wait one year to commence this project, the initial cost will increase by 4 percent and the cash inflows will increase to $7,900 a year. What is the value of the option to wait if the applicable discount rate is 9.5 percent? 26 Multiple Choice $182.67 $303.93 $421.56 $37363 $521.66

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