A Japanese recording label is considering producing a debut album for the Kyoto-grunge band Crashed Pumpkins (it has signed them to a 0-2 album contract). The alternative marketing plans for albums; it can do either, neither, or both (over two years). Plan A cost 250 million up-front; Plan B costs 400 million but has 50% higher revenues. Its arrangements with the group and distributors are such that its own revenues are an all-or-nothing proposition: Plan A returns 440 million in a year if the Pumpkins are a hit; but 0 in an equally likely outcome that the album bombs. The record label uses a 10% cost of capital in evaluating such investments Is the project acceptable under traditional NPV analysis? Is the project acceptable If real options are considered