Question: ABC invests in a project that has a 69% chance of success and a 31% chance of failure.If the project succeeds, the project's cash flow

ABC invests in a project that has a 69% chance of success and a 31% chance of failure.If the project succeeds, the project's cash flow from operation is $1.3 million at the end of the year. If they fail, the project's cash flow from operations is a loss of $279046 at the end of the year. What is the most that ABC should invest in the project today?The projects required rate of return is 12.8%.

a.

$ 718525

b.

$ 431115

c.

$ 639487

d.

$ 537456

e.

$ 668228

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