Pickwick Electronics is a new high-tech compnay financed entirely by $1 million ordinay shares, all of which are owned by Geroge Pickwick. The firm needs to rain $1 miilon now for state 1 and assuming all goes well a futher $1 million at the end of 5 years for stage 2. first cookham venture partner is considering two possible financing schemes: 1. Buying 2 million shares now at teir current valuation of $1. 2. buying 1 million s hares at the currel valuation and investing a futher $1 million at the end of 5 years at whatever the shares are worth. The outlook for Pickwick is uncertain but as long as te compay can secure te additional fiance for statge 2, it will be worth either $2million or 12 millon after completing stage 2. ****QUESTION: show the possible payoffs for Mr. Pickwik and First Cookham and Explain why one schem might be preffered. Assume an inter rate of zero