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River Rocks, Inc., is considering a project with the following projected free cash flows: 0 1 2 3 4 Year Cash Flow (in millions) -

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River Rocks, Inc., is considering a project with the following projected free cash flows: 0 1 2 3 4 Year Cash Flow (in millions) - $49.2 $9.4 $19.8 $20.7 $14.2 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 12.5%. 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) - $49.2 $9.4 $19.8 $20.7 $14.2 Year 0 1 2 3 4 O B. Cash Flows (millions) $49.2 $9.4 $19.8 $20.7 $14.2 Year 0 1 2 3 4 O C. Cash Flows (millions) -$49.2 - $9.4 $19.8 $20.7 - $14.2 Year 0 2 3 4 OD. Cash Flows (millions) $49.2 - $9.4 -$19.8 - $20.7 - $14.2 Year 0 1 2 3 4 The net present value of the project is $ million. (Round to three decimal places.) River Rocks take on this project because the NPV is (Select from the drop-down menus.)

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