Step by Step Enterprises is studying a project over 2 years. Initial investment is $300 million. After the first year, if demand is high, the company has an option to expand by investing an additional $180 million. The NPV of the project without expansion is $40.53 million. Option to Expand Expand $180 High demand (.7) $980 High demand (.5) $120 $220 Low demand (3) High demand (6) $480 Investment -$300 Do not expand Low demand (.4) High demand (.5) $180 Low demand (.5) $60 $330 Low demand (.5) $150 If the Cost of Capital is 8%, what is the value of the option to expand? $84.71 million $125.24 million $168.04 million $80.17 million