17. A project costs 200 million today. Next year (year 1) the cash inflow will be either 200 million or 40 million with equal probability. If the year 1 cash inflow was 200 million, then the year 2 cash flow will also be 200 million. If the year 1 cash inflow was 40 million, then the year 2 cash flow will also be 40 million. If the firm can abandon the project ONLY after year 1 for a known amount of 60 million at that time, what is the abandonment value if the appropriate discount rate is 5%? A 0 B C D E F B C I do not want to answer this question 10,420,000 E F 3,140,000 18. You have valued Candesic using different methods. The APV valuation gives you a result that is almost twice as high as the earnings multiple using a market regression. How would you reconcile the two findings? A 23,140,000 5,200,000 The multiple is too low because it wouldn't take into account future growth opportunities The APV is too high because we always assume the tax shield will be used DCF valuations are always higher than multiple valuations D The APV is too high because we always assume the tax shield will be used AND the multiple is too low because it wouldn't take into account future growth opportunities I do not want to answer this question None of the options listed