Growth Option: Decision-Tree Analysis Feche's Funny Hats is considering seting 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% probabity), 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 57,000 per year for 2 years. Fethe's cost of capital is 10%. Do not round intermediate calculations. a. What is the expected NPV of the project? Negative value, if any, should be incicated by a minus sign. Round your answer to the nearest dollar. 5 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 paryent of $20,000. In this case, the cash fows 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 7%. Select the correct decision tree. The correct graph is Use decision-tree analysis to calculate the expected NPV of this project, inciuding the option to continue for an additinal 2 years. Negetive values, if any, should be indicated by a minus sign. Round your answer to the nearest dollar. 5