Companies often come across projects that have positive NPV opportunities in which the company does not invest. Companies must evaluate the value of the option to invest in a new project that would potentially contribute to the growth of the firm. These options are referred to as growth options.

Consider the case of Hack Wellington Co$.$:

Hack Wellington Co$.$ is considering a three$-$year project that will require an initial investment of $$45,000.$ It has estimated that the annual cash flows for the project under good conditions will be $$70,000$ and $$7,000$ under bad conditions. The firm believes that there is a $60\%$ chance of good conditions and a $40\%$ chance of bad conditions.

If the firm is using a weighted average cost of capital of $13\%,$ the expected net present value $($NPV$)$ of the project is $.($Note: Round your answer to the nearest whole dollar.$)$

Hack Wellington Co$.$ wants to take a potential growth option into account when calculating the project$$s expected NPV$.$ If conditions are good, the firm will be able to invest $$2,000$ in year $2$ to generate an additional cash flow of $$15,000$ in year $3.$ If conditions are bad, the firm will not make any further investments in the project.

Using the information from the preceding problem, the expected NPV of this project$$when taking the growth option into account$$is$ $.($Note: Round your answer to the nearest whole dollar.$)$

Hack Wellington Co$.$s growth option is worth