Fethe's Funny Hats is considering selling trademarked, orange-haired curly wigs for University of Tennessee football games. The purchase cost for a 2-year franchise to sell the wigs is $20,000. If demand is good (40% probability), then the net cash flows will be $24,000 per year for 2 years. If demand is bad (60% probability), then the net cash flows will be $4,000 per year for 2 years. Fethe's cost of capital is 11%. Do not round Intermediate calculations. a. What is the expected NPV of the project? Negative value. If any, should be indicated by a minus sign. Round your answer to the nearest doltar. b. If Fethe makes the investment today, then it will have the option to renew the franchise fee for 2 more years at the end of Year 2 for an additional payment of $20,000. In this case, the cash flows that occurred in Years 1 and 2 will be repeated so If demand was good in Years 1 and 2, it will continue to be good in Years 3 and 4). Write out the decision tree. Note: The franchise fee payment at the end of Year 2 is known, so it should be discounted at the risk-free rate, which is 8%. Select the correct decision tree. B 119 405 Prob Good 11 1 2 3 20.000 24.000 24.000 24.000 24 000 - 20 000 = 0%) 40N Prob Good 20.000 24000 24000 24000 N 000 20 000 - 09) Bad 50% Prob Bad 60% Prob 20.000 4000 4000 4000 4000 20.000 2000 2000 D 119 1 = 8% 2 X1000 20000 4000 24001 40% Pob 405 Peb 20.000 1.000 4000 4000 4.000 Good 20.000 24000 24000 24000 24 000 - 20.000 (1 = 8%) Good 200U 24000 24000 2400 240 20.000 (1 = B) Bad 60% Prob Bad 60% Prob - 20.000 4.000 4000 4.000 4.000 - 20.000 4.000 4000 0 0 D 40% Prob Good = 0 1 2 3 20.000 24.000 24.000 24.000 24.000 20.000 (1 = 11%) = 11% O 1 20 000 4000 40Prob Good 2 3 4000 4000 4000 20.000(r = Bad 60% Prob. - 20 000 4000 Bad 60% Prob 4000 0 0 - 20.000 24000 24,000 0 The correct graph is -Select- Use decision-tree analysis to calculate the expected NPV of this project, including the option to continue for an additional 2 years. Negative values, If any. should be indicated by a minus sign. Round your answer to the nearest dollar