Risky Cash Flows

investment is made and have the following probability distributions:

BPC has decided to evaluate the riskier project at a $10\%$ rate and the less risky project at an $8\%$ rate.

a$.$ What are the expected values of the annual cash flows from each project? Do not round intermediate calculations. Round your answers to the nearest dollar.

Expected annual cash flow $\frac{?}{\text{b}\text{a}\text{r}}($$${)}^{\text{P}\text{r}\text{o}\text{j}\text{e}\text{c}\text{t}A}\frac{?}{(\text{\$}{)}^{\text{P}\text{r}\text{o}\text{j}\text{e}\text{c}\text{t}B}}$

What is the coefficient of variation $($CV$)$ for each project? Do not round intermediate calculations. Round your answers to two decimal places.

Project A

Project B

Coefficient of variation

b$.$ What is the risk$-$adjusted NPV of each project? Do not round intermediate calculations. Round your answers to the nearest cent.

Risk$-$adjusted NPV

Project A

Project B

c$.$ If it were known that Project B is negatively correlated with other cash flows of the firm whereas Project A is positively correlated, how would this affect the decision?

This would tend to reinforce the decision to

$]$ Project B$.$

If Project B$\text{'}$s cash flows were negatively correlated with gross domestic product $($GDP$),$ would that influence your assessment of its risk?