A proposed nuclear power plant will cost $2.7 billion to build and then will produce cash flows of $350 million a year for 15 years. After that period (in year 15), it must be decommissioned at a cost of $950 million.  a. What is the NPV of the project if the discount rate is 3%? b. What is the NPV of the project if the discount rate is 16%?

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A proposed nuclear power plant will cost $2.7 billion to build and then will produce cash flows of $350 million a year for 15 years. After that period (in year 15), it must be decommissioned at a cost of $950 million. 

a. What is the NPV of the project if the discount rate is 3%?

b. What is the NPV of the project if the discount rate is 16%?

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