npv

After graduating from school, our newly minted graduates decide to launch a venture "Likable Lunches." To have it, our new grads would need to invest $1,000 at t=0 for the ingredients and menu development for these lunches. The assumption is that there is a 70% chance that this phase will be successful and will continue.If this stage is not successful, the lunch project would be scrapped with no left overs : ( The second stage would consist of designing packaging and delivery of these lunches. This is estimated to cost $25,000 at t =1. If the lunch design and delivery test well, Franzi and Tony would then go into production.If they do not, the designs could be sold for $5,000. Success for the second stage is estimated at 85%. The third and final stage consists of purchasing an old Delmonte plant for lunch production.This would cost $200,000 at t =2. If the lunch economy is strong, the net value of sales would be $600,000; if the lunch economy is in recession, the net value would be $300,000. There's a 50-50 chance of strong or weak lunch economy. Our new grads' Cost of Capital is 10%. what is Our new grads' expected NPV?