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zero at the end of 10 years. Required returns are 15% for process A and % for pr Adam's Gears has a marginal tax rate

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zero at the end of 10 years. Required returns are 15% for process A and % for pr Adam's Gears has a marginal tax rate of30%, which, ifeither project should Adam undertake 12 ocess B. If B10. (Fut lion Proc and B4. (Future investment option) Virginia Matteson is considering a major investment in new tech nology for her executive recruiting business. Virginia has carefully considered the rev and costs that this investment will generate and finds that it is unprofitable. Her discounted cash flow analysis reveals an expected NPV of-$100,000. However, Virginia believes that this new technology could enable her to expand her business into a new area, that of renting professional staff such as accountants, lawyers, and computer specialists to her clients. The additional cost of preparing for the temporary professional business would have a present value of $100,000. Virginia believes that this new business, if future conditions justified it, would be worth a present value of $1,000,000. The probability of the temporary professional business becoming a reality, she estimates, is about 40%. What is the NPV of the investment in new technology if you include the cost and expected value of the future investment option? revenues b. C. B11, (R is o 5006 nrobahility

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