1. Oriole Company must perform an impairment test on its equipment. The equipment will produce the following cash flows: Year 1, $37,100; Year 2, $47,700; Year 3, $58,300. The discount rate is 10%. What is the value in use for this equipment? (For calculation purposes, use 5 decimal places as displayed in the factor table provided. Round final answer to 2 decimal places, e.g. 52.75.)

2. Marin Inc. is using a discounted cash flow model.

Scenario 1: Cash flows are fairly certain		Scenario 2: Cash flows are uncertain
$330/year for 5 years		75% probability that cash flows will be $330 in 5 years
Risk-adjusted discount rate is 8%		25% probability that cash flows will be $248 in 5 years
Risk-free discount rate is 4%		Risk-adjusted discount rate is 8%
		Risk-free discount rate is 4%

Identify which model Marin might use to estimate the discounted fair value under each scenario, and calculate the fair value. (For calculation purposes, use 5 decimal places as displayed in the factor table provided. Round final answers to 2 decimal places, e.g. 52.75.)

3. Keith Nobrega is trying to determine the amount to set aside so that he will have enough money on hand in 4 years to overhaul the engine on his vintage used car. While there is some uncertainty about the cost of engine overhauls in 4 years, by conducting some research on-line, Keith has developed the following estimates.

Engine Overhaul Estimated Cash Outflow			Probability Assessment
$290			10	%
470			30	%
710			50	%
760			10	%

How much should Keith deposit today in an account earning 6%, compounded annually, so that he will have enough money on hand in 4 years to pay for the overhaul? (For calculation purposes, use 5 decimal places as displayed in the factor table provided. Round final answer to 0 decimal places, e.g. 125.)