UQ is considering developing a solar farm in Warwick to enable the university to have 100% renewable electricty. Terrain solar led the project's initial study, which cost $200,000. You have been asked to provide a financial analysis for the project based on this study. The project's initial costs include land, $25 million, and solar panels, $100 million. The project's operating cost are $10.4 million per year, but saves the university $22.3 million in electricity costs every year. The current electricity costs are $25 million. The project is also expected to increase UQ's reputation and attract more students, estimating an additional $1.4 million net revenue a year. The land depreciation is zero, but the solar panels' cost are depreciated using the straight-line method over 25 years with an ending book value of 5 million. UQ plans to sell the farm in 10 years and develop another farm with a new technology. You estimate the land and solar panels will sell for $30 million and $50 million respectively in 10 years. The required rate of return for this project is 7.8% and the tax rate is 30%, what is the expected NPV? Round your answer to two decimals. When conducting further analysis, you find that the NPV of UQ's project is highly sensitive to the price of electricity. Therefore, you run a simulation study. You assume that the cost of one MWh of electricity has a normal probability distribution with a mean of $73 and a standard deviation of $12. The simulation result shows that NPV has a standard deviation of $8.4 million. Compare this with your NPV calculation. Explain how you interpret these numbers in terms of the risk of the project and give your final recommendation, which may include non-financial factors. UQ is considering developing a solar farm in Warwick to enable the university to have 100% renewable electricty. Terrain solar led the project's initial study, which cost $200,000. You have been asked to provide a financial analysis for the project based on this study. The project's initial costs include land, $25 million, and solar panels, $100 million. The project's operating cost are $10.4 million per year, but saves the university $22.3 million in electricity costs every year. The current electricity costs are $25 million. The project is also expected to increase UQ's reputation and attract more students, estimating an additional $1.4 million net revenue a year. The land depreciation is zero, but the solar panels' cost are depreciated using the straight-line method over 25 years with an ending book value of 5 million. UQ plans to sell the farm in 10 years and develop another farm with a new technology. You estimate the land and solar panels will sell for $30 million and $50 million respectively in 10 years. The required rate of return for this project is 7.8% and the tax rate is 30%, what is the expected NPV? Round your answer to two decimals. When conducting further analysis, you find that the NPV of UQ's project is highly sensitive to the price of electricity. Therefore, you run a simulation study. You assume that the cost of one MWh of electricity has a normal probability distribution with a mean of $73 and a standard deviation of $12. The simulation result shows that NPV has a standard deviation of $8.4 million. Compare this with your NPV calculation. Explain how you interpret these numbers in terms of the risk of the project and give your final recommendation, which may include non-financial factors