You are a manager at Ventus LLC, a producer of onshore wind farms. You are planning two large projects, one in Massachusetts and one in New York. While some companies have already committed to purchasing energy from the wind farms, there is some risk that the projects will fail and generate a loss for the company. The CEO has asked you to give her your risk assessment of the two projects. You have to decide whether you want to pitch the two projects individually or as one big project. Based on historical data, you calculated the loss probabilities. Suppose that each of the two projects has: 4% chance of a loss of $10 million, 2% chance of a loss of $1 million 94% chance of a profit of $1 million. Since the two wind farms are located in two different US states, you can assume that they are independent of each other. Answer the following questions: Question 1 1 Point What is the VaR for one of the projects when the confidence level is 95%? Based on the given loss probabilities for a single project: Question 1: The VaR at 95% confidence level is $10 million. This is because at the 95th percentile, the loss should not exceed the $10 million loss which has a 4% probability of occurring. 1 Question 2: The VaR at 99% confidence level is $1 million. This is because at the 99th percentile, the loss should not exceed the $1 million loss which has a 2% probability of occurring. 1 The key points are: VaR represents the maximum potential loss at a given confidence level For a single project, VaR at 95% is $10m since 4% chance of exceeding this For a single project, VaR at 99% is $1m since 2% chance of exceeding this The search results provide background information on wind farms, confidence intervals, and supply chains, but do not directly answer these specific VaR calculation questions for the given loss probabilities.Question 2 1 Point What is the VaR for one of the projects when the confidence level is 99%