Q1) Learning curve question. (2pts) Assume your production system has the learning curve of 80% (i.e 0.8 ). If the cost to produce 10th item is $2000 and, what is the cost to produce your 40th item? Q2) NPV question. (2pts) Assume you are a contractor (vendor) with two investment projects. Project 1 has the capital cost of $2M (at year zero) with the positive cash flow of $1M for year 1 and $1.5M for year 2 while Project 2 has the capital cost of $3M (at year zero) with the cash flow of $2M for year 1 and $2.5M for year 2 . Assume annual interest rate as 10%. Which project would you invest in if you have one option only? Why? Q3) Risk management question. (2pts) You are an investor, and you have two potential projects. Project A has a potential return of $20M, $40M, or $8M under high, average, and low market scenarios, respectively. Project B has a potential return of $20M,$16M, or $12M for the same scenarios. Which project would you pick if you are 3.A) A risk lover 3.B) A risk avoider 3.C) Risk neutral (assume the probabilities are 25%, 25%, and 50% for high, average, and low market scenarios, respectively)