You are an analyst working for Goldman Sachs, and you are trying to value the growth potential of a large, established company, Big Industries. Big Industries has a thriving R&D division that has consistently turned out successful products. You estimate that, on average, the division launches two projects every three years, so you estimate that there is a

63 %

chance that a project will be produced every year. Typically, the investment opportunities the R&D division produces require an initial investment of

$ 10.1

million and yield profits of

$ 1.04

million per year that grow at one of three possible growth rates in perpetuity:

3.4 %

,

0.0 %

,

and

negative 3.4 %

.

All three growth rates are equally likely for any given project. These opportunities are always "take it or leave it" opportunities: If they are not undertaken immediately, they disappear forever. Assume that the cost of capital will always remain at

12.1 %

per year. What is the present value of all future growth opportunities Big Industries will produce?

(Hint:

Make sure to round all intermediate calculations to at least four decimal

places.)