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You have just developed a breakthrough renewable energy technology. You have approached a venture capitalist, asking for a $ 7 5 million investment in your

You have just developed a breakthrough renewable energy technology. You have approached a venture capitalist, asking for a $75 million investment in your company. You believe that the initial $75 million investment will generate $30 million annual free cash flows indefinitely. The cash flow starts in year 2. The discount rate is 12.5%. If the venture capitalist agrees to give you the $75 million in exchange for a 40% ownership share in the company, what is the NPV of the venture capitalist?
a.21 million
b.-14.5 million
c.85.3 million
d.10.3 million
e.-21 million

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