Epsilon Corp. is evaluating an expansion of its business. The cash-flow forecasts for the project are as follows:

Years

Cash Flow

($ millions)

0

160

1-5

20

6-10

40

The firm's existing assets have a beta of 2.0. The risk-free interest rate is 3% and the expected return on the market portfolio is 13%.

Question: What is the project's NPV

Multiple Choice

-47.2

-64.1

-40.0

-20.6

7.04