2 Highland Mining and Minerals Co is considering the purchase of two gold mines Only one investment will be made. The Australian gold mine will cost $1648,000 and will produce $325 000 per year in years 5 through 15 and $523000 per year in years 16 through 25 The US gold mine wel cost $2047000 and will produce $253 000 per year for the next 25 years. The cost of capitalet percent Use Spendix for an aporomate answer but calculate your final answers using the formula and finance calculator methods Note In looking up present value factors for this problem you need to work with the concept of a deferred annuty for the Australian mine The returns in years 5 through 15 actually represent years, the returns in years 16 through 25 represent 10 years -1 Coculate the net present value for each project. Do not round intermediate calculations and round your answers to 2 decimat places 125 Net Present Val The Australian mine Theme 6-2. Wrach inwestment should be made? Australian mine US mine ME GEW HI 2 of 9 Next > Australian mine OUS mine 2 125 b-1. Assume the Australian mine justifies an extra 2 percent premium over the normal cost of capital because of its riskaness and relative uncertainty of cash flows Calculate the new net present value given this assumption (Negotive amount should be indicated by a minus sign Do not round intermediate calculations and round your answer to 2 decimal places.) Net Present Value The Australie -2. Does the new assumption change the investment decision? yes No M GEW HI