Question $3(2$ points$)$

Suppose that we are drilling an oil well. The drilling rig costs $$2700$ today, and in one year the well is either a success or a failure. The outcomes are equally likely. The discount rate is $4\%.$ The PV of the successful payoff at time one is $$5300.$ The PV of the unsuccessful payoff at time one is $$0.$ Now, we know that the rig can be sold for $$2600$ in a year. When we include the value of the option to abandon, the NPV of this drilling project should be $($keep two decimal places$)$:

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