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An auto plant that costs $160 million to build can produce a line of flex-fuel cars that will produce cash flows with a presen ralue

image text in transcribed An auto plant that costs $160 million to build can produce a line of flex-fuel cars that will produce cash flows with a presen ralue of $240 million if the line is successful but only $70 million if it is unsuccessful. You believe that the probability of success is only about 40%. You will learn whether the line is successful immediately after building the plant. a-1. Calculate the expected NPV. Note: Do not round intermediate calculations. A negative amount should be indicated by a minus sign. Enter your answers in millions rounded to 1 decimal place. a-2. Would you build the plant? Suppose that the plant can be sold for $110 million to another automaker if the auto line is not successful. o-1. Calculate the expected NPV. Note: Do not round intermediate calculations. A negative amount should be indicated by a minus sign. Enter your answers in millions rounded to 1 decimal place. o-2. Would you build the plant

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