Tissot Corporation has developed a new gadget. If the gadget is successful, the present value of the payoff (at the time the product is brought to market) is $21 million. If the gadget fails, the present value of the payoff is $8 million. If the gadget goes directly to market, there is a 50 percent chance of success. Alternatively, the company can delay the launch by one year and spend $1.10 million to test-market the gadget. Test-marketing would allow the firm to improve the gadget and increase the probability of success to 75%. The appropriate discount rate is 10%. Should the firm conduct test-marketing?

A. No, because NPV is lower by $290,560

B. No, because NPV is lower by $481,088

C. Yes, because NPV is higher by $657,480

D. Yes, because NPV is higher by $536,364

E. Yes, because NPV is higher by $375,482