1. An investment project promises to increase revenues by $28,000 and decrease operating costs by $10,000. The project will not affect depreciation and will allow you to reduce your inventory investment by $3,000 in the second year of the project's life. Calculate the net cash flows during that year if the corporate tax rate is 35 percent. 2. Jeff Corp. is planning on issuing $10 million in new common stock. The price of a share is currently $104. The next dividend to be paid is $4.00 (assume dividends are paid annually). Dividends grow at a constant 4%ew rate. What is the rate of return for common stock? 3. Your old bush-whacking machine was purchased seven years ago for $140,000. You are depreciating the machine using straight-line depreciation to a zero salvage value over its 10-year life. You can now sell it for $30,000. The corporate tax rate is 35 percent. Which of the following statements is true? a. You must pay taxes of $10,500 b. You will receive a tax write-off of $10,500 c. You must pay taxes of $4,200 d. You will receive a tax write-off of $4,200