Question: The project defined by the following decision tree has a required discount rate of 14 percent. What is the Time 1 net present value of

The project defined by the following decision tree has a required discount rate of 14 percent.

The project defined by the following decision tree has a required discount

What is the Time 1 net present value of a successful investment?

Multiple Choice options

$122,008,054
$126,583,344
$87,342,087
$92,305,012
$89,406,415

t=0 Cash Flow After Tax t=1 Invest $100.000.000 Success Year's 2-5 $66.000.000/year Test Cost Do Not Invest NPV=$0 $20,000,000 Failure NPV = $-20,000,000 Do not test t=0 Cash Flow After Tax t=1 Invest $100.000.000 Success Year's 2-5 $66.000.000/year Test Cost Do Not Invest NPV=$0 $20,000,000 Failure NPV = $-20,000,000 Do not test

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