In: Finance
Time zero: -150,000,000
Year 1: 110,000,000
Year 2: 85,000,000
Year 3: 90,000,000
Year 4: -40,000,000
Year 5: 150,000,000
The company has already spent $4,200,000 in research and development funds to explore the new project. If the company undertakes the new project it will also require that the company abandon an existing project that produces $12,000,000 in cash flows each year over the next five years. Finally, the company's Weighted Average Cost of Capital is 11%. Please show all of your work.