1-

A $12,000 investment will return annual benefit for six years with no salvage value at the end of six years. Assume straight line depreciation and a 46% tax rate and the inflation rate is 5%. What is the inflation free after tax rate of return on the investment if the annual benefits are $2,918 in todays dollars?

	a.	10.18%
	b.	4.94%
	c.	5%
	d.	8.20%

2-

Given the BTCF in Question #1, what is the after tax IRR if the equipment has a five year property class for MACRS depreciation?

	a.	25.92%
	b.	26.51%
	c.	10%
	d.	19.56%