0			1			2
Revenue				$	1,600		$	1,600
Expense					700			700
Depreciation					300			300
Pre-tax profit					600			600
Taxes					300			300
After-tax profit					300			300
Plant and equipment	$	1,500						850
Increased working capital		300						300
Free cash flow	$	1,800		$	600		$	1,750

In a discounted cash flow analysis of Giant Corp.s project described in the problem above, what would be the projected Year 2 free cash flow?

Multiple Choice

• $1,300

• $1,450

• $1,700

• $1,750