Genie Corporation expects cash flows from its risky assets in one year of ether 5100 million or $10 million with equal probability. The firm also has debt with tace value of $20 million due in one year. Genie is considering a new project that would require an investment of $18 milion today and would result in a certain cash flow in one year of $22 million. Genie has $18 million in cash which it can use to invest in the project. If the cash is not used for financing the project, it will be distributed to equityholders now as a dividend, Investors are all risk neutral, and the risk-free discount rate is zero. There are no taxes DEGREE ICES, TI CIAL SC Mier 20 1 Pri (a) What are the expected present values of Genie's equity and debt without the new project? (b) What are the expected present values of the firm's equity and debt if the firm decides to accept the new project? What is the incremental value to the equityholders? Will Genie's managers accept the project? Explain.