Monsters Incorporated (MI) in ready to launch a new product.Depending upon the success of this product, MI will have a value of either $100 million, $150 million, or $191 million, with each outcome being equally likely.The cash flows are unrelated to the state of the economy (i.e. risk from the project is diversifiable) so that the project has a beta of 0 and a cost of capital equal to the risk-free rate, which is currently 5%.Assume that the capital markets are perfect.

Suppose that MI has zero-coupon debt with a $140 million face value due next year.Calculate the total present value of MI with leverage.