Holmes has developed chocolate marbles. The product will be test marketed in the southeastern United States for 2 years, requires an initial investment of $2 million, and because of heavy promotional expenses is not expected to generate any positive CFs during the first 2 years. There is a 60 percent chance that demand for the chocolate marbles will be satisfactory; if that is so, an $8 million after-tax cash investment will be incurred at t = 2 to market the chocolate marbles in the eastern half of the United States. Subsequent CFs are as follows: $4,000,000 $7,000,000 3 4. $6,000,000 5 $3,000,000 6 If the test-market results are unfavorable (40 percent chance), then the chocolate marbles will be withdrawn from the market. Once consumer preferences are known, Holmes considers chocolate marbles an average-risk project requiring a 14 percent return. During the test-marketing phase a 25 percent return is required. What decision should Holmes make? Holmes has developed chocolate marbles. The product will be test marketed in the southeastern United States for 2 years, requires an initial investment of $2 million, and because of heavy promotional expenses is not expected to generate any positive CFs during the first 2 years. There is a 60 percent chance that demand for the chocolate marbles will be satisfactory; if that is so, an $8 million after-tax cash investment will be incurred at t = 2 to market the chocolate marbles in the eastern half of the United States. Subsequent CFs are as follows: $4,000,000 $7,000,000 3 4. $6,000,000 5 $3,000,000 6 If the test-market results are unfavorable (40 percent chance), then the chocolate marbles will be withdrawn from the market. Once consumer preferences are known, Holmes considers chocolate marbles an average-risk project requiring a 14 percent return. During the test-marketing phase a 25 percent return is required. What decision should Holmes make