Triton is a company producing speed boats. It considering investing in a new project. The project will generate revenues of $18 million in its first year of operation, and these revenues will grow at the rate of 6% per year thereafter. The project also entails R&D expenditures of $4 million in the first year of operation and these expenditures are expected to grow at the rate of 10% per year. If the company decides to undertake the project now, it will become operational next year. The CFO recommends that the project be undertaken, but that it be pursued only as long as it yields a positive net cash flow. That is, it will be terminated when R&D expenditures are larger than the revenues. The weighted average cost of capital is 12%. The firm must invest $158 million upfront. It also must pay $70 million for clean-up costs for environmental protection during the last year of the project. If undertaken, the project will be pursued for _________ years and will have a net present value of __________.

Select one:

a. 56 years; $2.126 million

b. 48 years; - $14.354 million

c. 41 years; $5. 484million

d. 25 years; - $3.598 million

e. 33 years; $23.578 million