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46) Prada has ten million shares outstanding, generates free cash flows of $60 million each year and has a cost of capital of 10%. It

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46) Prada has ten million shares outstanding, generates free cash flows of $60 million each year and has a cost of capital of 10%. It also has $40 million of cash on hand. Prada wants to decide whether to repurchase shares or invest the cash in a project that generates free cash flows of $2 million each year. Should Prada invest or repurchase the shares? A) invest B) repurchase C) indifferent between options D) cannot say for sure

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