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Tropical Soft Drinks is evaluating a proposal to install solar panels on the roof of its factory near San Juan. The panels will cost $40000

Tropical Soft Drinks is evaluating a proposal to install solar panels on the roof of its factory near San Juan. The panels will cost $40000 per set. Depending on the price of electricity and the efficiency of the panels, the project will increase operating cash flows by either $9000 per year or $15000 per year with a 56% likelihood that the lesser outcome will occur. The useful life of the panels is 5 years. If early results indicate savings of $15000 per year, 4 additional sets of panels will be installed next year at the same cost with the same projected savings. What is the expected NPV of the project including the option to expand, given a discount rate of 8%?

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