Hawkins expected his firm to earn $1,000 per year forever, with no growth. Given a cost of capital of 10 percent, the value of the firm is $10,000. Hawkins identified a new project, which costs $1,000 but would earn 11 percent per year forever. To invest in this project, Hawkins cancelled this years dividend. Given that he is investing in a positive NPV project, he expected his stock to rise. However, if fell dramatically. Explain what happened. Does this mean that investors do not like positive NPV projects?