Bosjoly Enterprises is considering buying a vacant lot for an after-tax cost of $1 millign. If the property is purchused; the company's plan is to invest another $5 millon after taues todar (t=0) to buld a hotel on the property. The after-tax cash fows from the hotel will depend critically on whecher the state imposes a tourism tax in this year's legistative expected to produce aftertax cash flows of $1,100,000 at the end of each of the next 15 years. The project has a 12% WACC. Assume at the outsot that the cocnpany does not huve the opticn to delay the project. a. What is the project's expected NPV if the tax is imposed? Negative value, If any, should be indicated by a minus sign, Do not rownd intermediate calculations. Round rour answer to the nesrest cent. \$ b. What is the projects expected NPV if the tax is not imposed? Negative value, if any, should be indicated by a minus sign. Do not round intermediate calculations. Alound Your answer to the nearest cent. 5 C. Given that there is a 50% chance that the tax will be imposed, what is the project's expected NPV if management proceeds with it today Negative value, if any, should be indicated by a minus sign. Do not reund intermediate calculations. Hound vour answer to the nearest cent. 4 d. Athough the company does not have an option to deloy construction, it does have the option to abandon the project 1 yeor from naw if the tax is imposed. If it abandons the project, it will seli the complete property 1 year from now at an expected price of 16 million after taxes. Once the project is abandoned, the company nat ne longer receive ary cash flows. Assuming that all cash fiows are escounted at 12%, will the existence of this abandoniment option affect the company secision to proceed nith the project today? Negative value, if any, pould be indicated by a minus sign. Do not reund intermediate calculations, Round vour answer to the nearest cent. 1 e. Finally, assume that there is no option to abandon or deiay the project, but that the company has an option to purchase an adjacent property in 1 year for an after-tax purchase option (at t - 1) for the adjacent preperty? Negotive value, if aem, should be indlcated by a minus sigh. Do not round insermediate calculations. Hesind your antwer to the nearest cent. 4