Answer Happy

ABC Company is conducting a project with an up-front cost at t =
0 of $1,100,000. The project's subsequent cash flows are dependent
on whether a competitor's product is approved by FDA. There is a
60% chance that the competitive product will be rejected, in which
case the company's expected cash flows will be $506,154 at the end
of each of the next four years (t = 1 to 4). There is a 40% chance
that the competitor's product will be approved, in which case the
expected cash flows will be only $151,218 t = 1 to 4. The company
will know for sure one year from today whether the competitor's
product has been approved.
If it waits a year, the project's up-front cost at t = 1 will
remain at $1,100,000. The subsequent cash flows will also
remain the same with the same probabilities as no waiting,
but will be received only for three years (t = 2 to 4).
All cash flows are discounted at the company's WACC of
10%.
What will the NPV at t=0 for each of the two strategies
be? Round your answers to the nearest dollar, e.g., xxx,xxx.
(Hint: Refer to the Evaluation of Investment Timing Option example
in Real Options.)
NPV at t=0 if the company proceeds today = _____
NPV at t=0 if the company waits a year = _____