Bio-Egen Inc. is a technology firm working on a new technology for producing electricity. The new technology involves two stages of investment. The first stage, which starts at time 0 and takes one year to complete, requires an investment of $30 million and has a probability of success of 17%. The second stage starts at time 1 and takes one year to complete. If the first stage is successful, the second stage has a probability of success of 76%. Otherwise, the second stage has a probability of success of only 10%. In both cases, the second stage requires an investment of $94 million. If successful, this technology will produce a perpetual risky stream of cash flows of $50 million per year, starting in year 2. Assume that the project's risk is completely idiosyncratic, and thus the appropriate discount rate for all cash flows is the risk-free rate, which is 10% per year.

What is the NPV of the investment if the company must commit to both stages of investment?

Suppose the firm is able to shut down the development process after the first stage. What is the NPV of the investment in this case?