11-B3 Taxes, Straight-Line Depreciation, and NPV The president of Genomies, Inc., a biotechnology company, is considering the purchase of some equipment used for research and development. The cost is $400,000, the economic life and the recov- ery period are both five years, and there is no terminal disposal value. Annual pretax cash inflows from operations would inerease by $140,000, giving a total five-year pretax savings of $700,000. The income tax rate is 40%, and the required after-tax rate of return is 14%. 1. Compute the net present value, assuming straight-line depreciation of $80,000 yearly for tax pur poses. Should Genomics acquire the equipment