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capits of & prront. The nroiects subsequent cash fows are uncertain. There in a 70 berrert chance. that the propect will be successfud and generate

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capits of \& prront. The nroiects subsequent cash fows are uncertain. There in a 70 berrert chance. that the propect will be successfud and generate a cash flow of 5250.000 at the end of wach of the next tien vears (Vears 2-10), while there is a 30 percent chance that the project will not be buconstat and will only generate cash flows of $30,000 over each of the next five vears Clears 1-5) As vau can cakculate, the net present value of taking on the project today (Year 0 is $710,198.64 If wour company delays taking on the project for one year (takes it on at Year 1). it can determine whether the cash flows will be $250,000 for the next ten years (Years 2-11), or $30.000 for the next five years (Years 2-6) by doing additional market research. Untortunately, the market research. penalties for contract delays, and inflation, will raise the price of taking on this project to $550000 at Year 1. Based on this information, and assuming that the relevant risk-adjusted disccunt rate remains at 8 percent, determine how much delaying the project will increase or decrease the project's expected NPV in today's dollars (Year O), relative to the project's NPV if it proceeds today. $18,128.44 $19,049.92 $20,601.59 $17,757.00 $22,874.98

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