Computational Consider the following 3 period project. The resulting cashflows are binomially distributed, either the HIGH case, or the LOW case. They are equally likely. HIGH CASE Time period 0 1 2 3 Initial Investment 600 Gross Revenue 800 800 0 Cost of Goods Sold 0 800 400 400 400 LOW CASE Time period 1 2 3 0 600 Initial Investment Gross Revenue Cost of Goods Sold 0 0 400 400 400 200 200 200 a) Find the expected values, then compute straightline depreciation, taxes (at 30%), before tax earnings, after tax earnings and cashflows for each period. (show your work) b) Assume the cost of capital is 10%. Estimate the NPV for the project. c) If you wait one period, the true outcome (HIGH or LOW) will be apparent. Assuming the project cashflows would be delayed but otherwise unchanged by waiting, what is the value of the option to wait one period