292042 > Question 2 4 pts High Roller Properties is considering building a new casino at a cost of $10.0 million att +0. The after-tax cash flows the casino generates will depend on whether the state imposes a new income tax, and there is a 50-50 chance the tax will pass. If it passes, after-tax cash flows will be $1.875 million per year for the next 5 years. If it doesn't pass the after tax cash flows will be $3.75 million per year for the next 5 years. The project's WACC is 11.0%. If the tax is passed, the firm will have the option to abandon the project 1 year from now, in which case the property could be sold to net $6.7 million after tax att - 1. What is the value in thousands) of this abandonment option? Do not round Intermediate calculations. O $437 $418 $318 $457 O $398 Question 3 4 pts 26 AN A b MacBook Air 303 RAS BOB F4 44 11 13 FA 17 9 10 # 3 $ 4 % 5 A 6 &7 00* 9 0 Question 12 4 pts A group of venture investors is considering putting money into Lemma Books, which wants to produce a new reader for electronic books. The variable cost per unit is estimated at $250, the sales price would be set at twice the VC/unit, or $500, and fixed costs are estimated at $350,000 The Investors will put up the funds if the project is likely to have an operating income of $500,000 or more. What sales volume would be required in order to meet the minimum profit goal? (Hint: Use the break-even formula, but include the required profit in the numerator) O 2.958 0 3,400 03.094 3.700 0.4.216 D Question 13 4 pts You work for the CEO of a new company that plans to manufacture and sell a new product a watch that has an embedded TV set and a magnifying glass crystal The issue now is how to finance the MacBook Air 5 ! 80 888 FZ F3 A * # 3 $ 4 % 5 & 7 1 0 CO 9 E V R T Y O U P