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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) - $50.5 $9.1 $20.8 $20.9 $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 12.8%. 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) - $50.5 $20.8 $20.9 $14.2 $9.1 + Year 0 2 3 4 O B. Cash Flows (millions) $50.5 $20.8 $20.9 $14.2 $9.1 + 1 Year 0 2 3 4 C. Cash Flows (millions) $50.5 - $9.1 - $20.8 - $20.9 - $14.2 Year 0 1 2 3 4 D. Cash Flows (millions) - $50.5 - $20.8 - $20.9 - $14.2 - $9.1 + 1 Year 0 2 3 4

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