A chemical manufacturer is setting up capacity in Europe and North America for the next three years. The annual demand for each market is 1 million Kilograms (kg) and is likely to stay at that level. The two choices under consideration are building 2 million units of capacity in North America (Option 1) or building 1 million units of capacity in each of the two locations (Option2). Building two plants will insure an additional one time cost of 1.5 million. The variable cost of production in North America (for either a large or a small plant) is currently $5/kg, where the cost in Europe is 4 euro/kg. The current exchange rate is 1 euro for the U.S. $1.20. Over each of the next three years, the dollar is expected to strengthen by 6%, with a probability of 0.6, or weaken by 4%, with a probability of 0.4. Assume a discount factor of 8%. What should the chemical manufacturer do? Provide two options NPVs.