Break-even cash inflows and risk Boardman Gases and Chemicals is a supplior of highly purifled gases to semiconductcr manufacturers. A large chip producor has asked Boserdman to build a new gas production facility close to an existing semiconductor plant. Once the new gas plant is in place, Boardman will be tho exelusive suppler for that semiconductor fabrication plant for the subsequent 10 years. Boardman is considering one of two plant designs. The first is Boardman's "standard" plant which will cost $39.5 million to build. The second is for a "custom" plant which will cost $52.6 million to buld. The custom plant will allow Boardman to produce the highly specialized gases required for an emergency semiconduclor manufacturing process. Boardman estimates that its client will order $11.6 million of product per year if the standard plant is constructed, but if the custom design is put in place, Boardman expects to sell $16.8 million worth of product annually to its client. Boardman has onough money to buld aither type of plant, and, in the absence of risk differences, accepts the project with the highest NPV. The cost of capital is 16.6%. a. Find the NPV for each project. Are the projects acceptable? b. Find the break-oven cash inflow for each project. c. The firm has estimated the probabilities of achieving various ranges of cash inflows for the two projects, as shown in the table What is the probability that each preject will achieve the break-even cash inflow found in part (b)? d. Which projoct is more risky? Which project has the potentially higher NPV? Discuss the risk-retum trade-olfs of the two projects. e. If the firm wished to minimizo lossos (that is, NPV