An auto plant that costs $180 million to build can produce a

line of flexfuel cars that will produce cash flows with a present

value of $220 million if the line is successful but only $110

million if it is unsuccessful. You believe that the probability of

success is only about 50%. You learn whether the line is successful

immediately after building the plant.

a-1.

Calculate the expected NPV. (Negative amount should be

indicated by a minus sign. Enter your answer in millions.)

a-2.

Would you build the plant?

b-1.

Calculate the expected NPV. (Negative amount should be indicated by

a minus sign. Enter your answer in millions rounded to 1 decimal

place

b-2.

Would you build the plant?