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10.- Gold Silver Co. analyzes an opportunity to start operations of gold mining in Venezuela. The cost of analyzing this project is 2 million euros. In the first 3 years they should invest 100 million euros annually starting from To. In year 3 (Ts), the project is expected to provide an annual income of 150 million euros (up until year 15 (included)) with an operating cost of 1 million euros at (annually). At the end of year 15 the mining project is expected to be sold at 400 million euros. The risk free rate is 4% and the cost of capital of similar projects is 7.5%. What would you advise to Gold Silver? a. Do the project. The NPV is EUR +903.33. b. Do the project. The NPV is EUR +772.84. c. Reject the project. The NPV is EUR -1170.87. d. None of the above.

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