Herman Co, is considering a four-year project that will require an initial investment of $5,000. The base-case cash flows for this profect are projected to be $14,000 per year. The best-case cash flows are projected to be $26,000 per year, and the worst-case cash flows are projected to be - $4,500 per vear. The company's analysts have estimated that there is a 50% probability that the project will generate the base-case cash fiows. The analysts alsa think that there is a 25% probability of the project generating the best-case cash fows and a 25% probability of the project generating the worstcase cash flowt. What would be the expected net present value (NPV) of this project if the project's cost of capital is 12\%? $34,216 529,328 $32,587 $39,104 Herman now wants to take into account its abilay to abandon the project as the end of vear 2 if the project ends up generating the worst-case scenario cash fows. If it decides to abandon the project at the end of vear 2 , the company wal recelve a one-time net cash infow of $3,500 (at the end of year 2). The $3,500 the company receives at the end of year 2 is the deference between the cash the company receves from seling off the project's assets and the company $4,500 cash outflow from operations. Addaionally, if it abandons the project, the company will have no cash flews in years 3 and 4 of the project. Using the information in the preceding probiem, find the expected NPV of this project when taking the abandanment eption inte account $35,697 $46,406 537,482 541,052 What is the value of the option to abandon the proyect