Singh Development Co. is deciding whether to proceed with Project X. The after-tax cost would be $10 million in Year 0. There is a 50% chance that X would be hugely successful and would generate annual after-tax cash flows of $6 million per year during Years 1, 2, and 3. However, there is a 50% chance that X would be less successful and would generate after-tax cash flows of only $1 million per year for the 3 years. If Project X is hugely successful, it would open the door to another investment, Project Y, which would require an after-tax outlay of $10 million at the end of Year 2. Project Y would then be sold to another company netting $20 million after taxes at the end of Year 3. Singhs WACC is 10%.

a. If the company does not consider real options, what is Project Xs expected NPV? Enter your answers in millions. For example, an answer of $10,550,000 should be entered as 10.55. Negative value, if any, should be indicated by a minus sign. Do not round intermediate calculations. Round your answer to three decimal places.

b.What is Xs expected NPV with the growth option? Enter your answers in millions. For example, an answer of $10,550,000 should be entered as 10.55. Negative value, if any, should be indicated by a minus sign. Do not round intermediate calculations. Round your answer to three decimal places.

c. What is the value of the growth option? Enter your answers in millions. For example, an answer of $10,550,000 should be entered as 10.55. Negative value, if any, should be indicated by a minus sign. Do not round intermediate calculations. Round your answer to three decimal places.