You are planning to produce a new action figure called "Nia". However, you are very uncertain about the demand for the product. If it is a hit, you will have net cash flows of $$90$ million per year for three years $($starting next year $[$i$.$e$.,$ at $t=1).$ If it fails, you will only have net cash flows of $$50$ million per year for two years $($also starting next year$).$ There is an equal chance that it will be a hit or failure $($probability $=50$ percent$).$ You will not know whether it is a hit or a failure until after the first year's cash flows are in $($i$.$e$.,$ at $t=1).$ You must spend $$180$ million immediately for equipment and the rights to produce the figure. If the discount rate is $10$ percent, calculate Nia's NPV$.$

Multiple Choice

$$29\mathrm{.}54$

$$20\mathrm{.}70$

$-$$$30\mathrm{.}00$