Question: Cash Flows ($ mln) Projects Alpha Beta CFO -12.55 CF2 4.75 CF3 4.75 CF4 4.75 -8.25 CF1 4.75 3.85 0 0 4.75 4.95 o Gamma

Cash Flows ($ mln) Projects Alpha Beta CFO -12.55 CF2 4.75

Cash Flows ($ mln) Projects Alpha Beta CFO -12.55 CF2 4.75 CF3 4.75 CF4 4.75 -8.25 CF1 4.75 3.85 0 0 4.75 4.95 o Gamma -6.25 0 0 12.75 Delta -24.95 0 0 43.95 Popcorn Corp. is considering the above four mutually exclusive projects. The firm has a marginal tax rate of 25%, an average tax rate of 17.5% and a WACC 7.25%. Management is trying to decide between projects Beta and Gamma. To do so, management should employ as their decision criteria, for which Beta would have a value of $ mln and Gamma would have a value of $ mln. As such, the firm should choose project

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