QUESTION 29 You can invest in a project either now or next year. If it is successful, you get a perpetual cash flow of $

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Question 29 You Can Invest In A Project Either Now Or Next Year If It Is Successful You Get A Perpetual Cash Flow Of 1 (50.3 KiB) Viewed 32 times

QUESTION 29 You can invest in a project either now or next year. If it is successful, you get a perpetual cash flow of $30M that starts the following year and grows at rate of 2 percent. If it is unsuccessful, you get a perpetual cash flow of $10M that starts the following year and grows at a rate of 2 percent. The project costs $160M and has a discount rate of 12 percent. Both states are equally likely What is the NPV of the project if you invest today? O $60 OM $40.OM 0 $6.67M