Q3) Example: a project whose initial cost = $75 million, Cost of Capital = 10%, risk-free rate= 6%, cash flows occur for 3 years. The probability distribution of its cash flows for each year is as follows: (3 marks) Demand High Average Low Probability 30% 40% 30% a) What is the E(NPV) if the project is implemented now? (1 marks) b) What is the E(NPV) if the firm waited for one year? (2 marks) Annual cash flow $50 $35 $20