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XYZ owns an operates sports facilities. The objective of its managers is to maximize shareholder value. The firm is evaluating the hoops project which involves

XYZ owns an operates sports facilities. The objective of its managers is to maximize shareholder value. The firm is evaluating the hoops project which involves building basketball courts in a local mall which assertion is true based on the information given in the question and the following table on the project.Base-case NPV: $15,700Value Created a 50 or more inches of snowfall in the winter: -$53,100Value created if worst case sales occur : -$87,900Value created best case sales occur : $26,000Probability that project will create more than zero dollars of value : 10.14ANSWERS:XYZ should accept the hoops project It is not clear whether XYZ should accept or reject the hoops project because the cost of capital is not given It is not clear whether XYZ should accept or reject that is provided contradictory with respect to answering the question XYZ should be indifferent between accepting and rejecting hoops projectXYZ should reject the hoops project

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