Question no 3: A firm has an investment proposal, requiring an outlay of Rs.40000. The investment proposal is expected to have 2 years economic life with no salvage value. In year 1 there is a 0.4 probability that cash inflow after tax will be Rs.25000 and 0.6 probability that cash inflow after tax will be Rs.30000. The probabilities assigned to cash inflow after tax for the year Il are as follows: Cash flow Year 1 Rs.25000 Probabilicy Rs.30000 Probability Cash flow Year 2 Rs.12000 0.2 Rs.20000 0.4 Rs. 16000 0.3 Rs.25000 0.5 Rs.22000 0.5 Rs.30000 0.1 The firm uses a 10% discount rate for this type of investment. Required: a. Construct a decision tree for the proposed investment project. b. What net present value will be project yield if worst outcome is realized? What is the probability of occurrence of this NPV? c. What will be the best and the probability of that occurrence? d. Will the project be accepted? (10% discount factor 1 year 0.909 and 2 year 0.826)