Zymase is a biotechnology startup firm. Researchers at Zymase must choose one of three different research strategies. Th

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Zymase Is A Biotechnology Startup Firm Researchers At Zymase Must Choose One Of Three Different Research Strategies Th 1 (78.27 KiB) Viewed 9 times

Zymase is a biotechnology startup firm. Researchers at Zymase must choose one of three different research strategies. The payoffs (after-tax) and their likelihood for each strategy are shown here. The risk of each project is diversifiable. a. Which project has the highest expected payoff? b. Suppose Zymase has debt of $30 million due at the time of the project's payoff. Which project has the highest expected payoff for equity holders? c. Suppose Zymase has debt of $120 million due at the time of the project's payoff. Which project has the highest expected payoff for equity holders? d. If management chooses the strategy that maximizes the payoff to equity holders, what is the expected agency cost to the firm from having $30 million in debt due? What is the expected agency cost to the firm from having $120 million in debt due? a. Which project has the highest expected payoff? The project with the highest expected payoff is: (Select the best choice below.) O A. Project A O B. Project B O C. Project C b. Suppose Zymase has debt of $30 million due at the time of the project's payoff. Which project has the highest expected payoff for equity holders? If Zymase has debt of $30 million due at the time of the project's payoff, the project with the highest expected payoff for equity holders is: (Select the best choice below.) O A. Project A O B. Project B O C. Project C (...) c. Suppose Zymase has debt of $120 million due at the time of the project's payoff. Which project has the highest expected payoff for equity holders? If Zymase has debt of $120 million due at the time of the project's payoff, the project with the highest expected payoff for equity holders is: (Select the best choice below.) O A. Project A O B. Project B O C. Project C Data table (Click on the following icon in order to copy its contents into a spreadsheet.) Strategy Probability Payoff (in $ million) A 100% 90 B 50% 160 50% 10% 90% C Print Done 0 370 30 d. If management chooses the strategy that maximizes the payoff to equity holders, what is the expected agency cost to the firm from having $30 million in debt due? What is the expected agency cost to the firm from having $120 million in debt due? If management chooses the strategy that maximizes the payoff to equity holders, the expected agency cost to the firm from having $30 million in debt due is $ million. (Round to the nearest integer.) The expected agency cost to the firm from having $120 million in debt due is 5 million. (Round to the nearest integer.) - X