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River Rocks, Inc., is considering a project with the following projected free cash flows: Year 2 3 Cash Flow - $50.7 $9.5 $20.3 (in millions)

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River Rocks, Inc., is considering a project with the following projected free cash flows: Year 2 3 Cash Flow - $50.7 $9.5 $20.3 (in millions) $19.3 0 1 4 $14.8 The firm believes that given the risk of this project, the WACC method is the appropriate approach to valuing the project. River Rocks' WACC is 12.2%. Should it take on this project? Why or why not? The timeline for the project's cash flows is: (Select the best choice below.) O A. Cash Flows (millions) $50.7 $9.5 $20.3 $19.3 $14.8 Year 0 1 3 B. Cash Flows (millions) - $50.7 $9.5 $19.3 $14.8 $20.3 + 2 1 3 4 Year 0 C: Cash Flows (millions) $50.7 - $9.5 - $20.3 - $19.3 - $14.8 Year 0 2 3 D. Cash Flows (millions) - $50.7 $9.5 - $20.3 - $19.3 - $14.8 Year 0 3 The net present value of the project is $ million. (Round to three decimal places.)

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