1. Assume a corporation has earnings before depreciation, interest and taxes of $100,000, depreciation of $40,000, and that it has a 30 percent tax bracket the after-tax cash flows (same as operating cash flow) for the company if it has no interest expense? What are Answer: $110,000 Stone Inc. is evaluating a project with an initial cost of $8,450. Cash inflows are expected to be $3,900, $3,900 and $3,900 in the three years over which the project will produce cash flows. If the discount rate is 13%, what is IRR of the project? 2. Answer: 18.2% Stone Inc. is evaluating a project with an initial cost of $8,450. Cash inflows are expected to be $3,900, $3,900 and $3,900 in the three years over which the project will produce cash flows. If the discount rate is 13%, what is the PI for the project? 3. Answer: 1.09 What is the NPV? Answer: $758.50