Jerry's drive-in theater is considering investing in a second screen so that he can show two movies at a time.\ Suppose he knows that no matter what, it will currently cost him

$950,000

to construct the second screen. If\ he expects the screen to increase his revenue by

$0.1

million per year and is facing an interest rate of

3%

and\ depreciation of

2%

, is it worth it for him to build the second screen, and why?\ Yes, as the present value is worth

$1,050,000

more than the cost.\ Yes, as the present value is worth

$50,000

less than the cost to construct.\ No, as the present value is worth

$25,000

less than the cost to construct.\ No, as the present value is worth

$1,050,000

more than the cost.