I need this answered. I only need the answers! There is only 1 question with multiples parts. I am provided 2 pictures so that you can see what's in the drop down menu.

0000. Verizon '3 5:36 AM E' a mathxl.com C ' ad [View from in l- inane? Test: Final Exam Tiini-Rt-mxmilriu:02:42:29 Suljn'lit'iesi This Question: 25 pts 4 7 of 12 l7 completa) V D This hot: 290 pte possible it Western Airlines is considering a new route that will require adding an additional Boeing 777 to its fleet, Western can purchase the airplane for $227.? million or lease it for $25.0 million per year. If it purchases the airplane, its seating can be optimized, and the new route is expected to generate prots of $48.6 million per year. If leased, the route will only generate prots of $33.4 million per year. Suppose the appropriate cost of capital is 12.7% and that, if purchased, the plane can be sold at any time for an expected resale price of $227.7 million. Ignore taxes. a. As a one-year decision. does purchasing or leasing the plane have higher NPV? b. Suppose the funds to purchase or lease the plane will come from equity holders (for example, by reducing the amount of Westem's current dividend). Western also has one-year debt outstanding, and there is a 9.4% (risk-neutral) probability that over the next year Westem will declare bankmptcy and its equity holders will be wiped out. Otherwise, the debt will be rolled over at the end of the year. Is purchasing or leasing the plane more attractive to equity holders? 6. At what (riskneutral) probability of default would equity holders' preference for leasing versus purchasing the plane change? a. As a one-year decision, does purchasing or leasing the plane have higher NPV? The NPV of purchasing is $D million. {Round to two decimal places.) The NPV of leasing is 3'1 million. (Round to two decimal places.) (Select from the drop-down menu.) As a one-year decision the NPV of |:| the plane is higher. b. Suppose the funds to purchase or lease the plane will come from equity holders (for example. by reducing the amount at Western's current dividend). Western also has one-year debt outstanding, and there is a 9.4% (risk-neutral] probability that over the next year Western will declare bankruptcy and its equity holders will be wiped out. Otherwise, the debt will be rolled over at the end of the year. Is purchasing or leasing the plane more attractive to equity holders? The NPV of purchasing is 3'1 million. (Round to two decimal places.) The NPV of leasing is $|:] million. (Round to two decimal places.) 1:. At what (risk-neutral) probability of default would equity holders' preference for leasing versus purchasing the plane change? The risk-neutral probability is [1%. [Round to two decimal places.) Enter your answer in each of the answer boxes.