1.

A machine is expected to produce annual savings in cash operating costs of $300,000 for the next four years.

FV of 1 (i = 5%, n = 4):	1.216
FV of a series of $1 cash flows (i = 5%, n = 4):	4.310
PV of $1 (i = 5%; n = 4):	0.823
PV of a series of $1 cash flows (i = 5%, n = 4):	3.546

If the company has a(n) 5% after-tax hurdle rate and is subject to a 30% income tax rate, the correct discounted net cash flow would be:

2.

A machine is expected to produce increases in cash operating costs of $220,000 for the next six years.

FV of 1 (i = 14%, n = 6):	2.195
FV of a series of $1 cash flows (i = 14%, n = 6):	8.536
PV of $1 (i = 14%; n = 6):	0.456
PV of a series of $1 cash flows (i = 14%, n = 6):	3.889

If the company has a(n) 14% after-tax hurdle rate and is subject to a 30% income tax rate, the correct discounted net cash flow would be: