an IPD is 10%. Otherwise , if the company is acquired by another company in 10 years [which happens with 25% probability ], the expected acquisition value will be $1 billion . If the company does not get acquiredI it will be worth 0. The founders of the company initially allocate 1,000,000 shares to themselves , and decide keep 350,000 shares in reserve in case they wish to hire any additional employees in the future . a] Please provide the share price of the startup in each round of nancing and the number of shares issued to investors in each round. b} How do your answers to part a) change if the probability of acquisition is only 15% [assume all other information in the problem stays the same]? Please provide one sentence explaining intuition for how the results change . c} Suppose the founders wish to understand how potential changes in the investment amounts would impact the share price in each round. If the share price in round 2 were to increase by 10%I due to a change ofx% in the investment amount in the third year ,what would x be? [assume all other information in the problems stays the same as originally posed , so the probability of acquisition is 25 '36. Also assume that the number of new shares issued to investors at time 0 stays the same as what you calculated in part a}. If you are unable to answer this question, please explain why. Question 6 [20 points] Today is January 1, 2021 . You are helping Felix make 10year cash ow projections for a project in the electronics industry .The cost of financing for the project can be inferred from the following data. Analysts estimate that the typical cost of debt for electronics projects is approximately 5.1%. The projected beta of equity for the project is 1.20I and the firm is planning to maintain a constant debt-tc-equity ratio (in market values) of 0.40. Using expert forecasts for stock market returns ,you believe that the annual expected return for the entire market will be 3% for the next 10 years, and that the riskfree rate will be projected to remain at 4.5% over the entire life of the project .Assume a marginal tax rate of 25%, and that any tax loss can be carried fonvard indenitely The project will have various investment needs . For example ,the machinery needed for the project costs $3 million , and according to the tax authority , is depreciated using the straight line method over ten years . You can operate the machinery for 10 years . The pre ta:x sahrage value of the machinery at the end of the 10 years is expected to be $300,000 .The purchase of the machinery is made today . You also expect to incur additional capital expenditures of $1.4 million for new computer equipment on December 31, 202?. This equipment is depreciated using the straight line method over the remaining life of the project , and is not expected to have any sahrage value . The revenues from the project are expected to be $20 million rst starting on December 31, 2021 , and are expected to grow at a rate of 2.5% per year. Labor is expected to cost approximately $1.2 million every year, while COGS are estimated to be 15% of revenues each year