1.A project has an initial requirement of $310,000 for fixed assets and $32,000 for net working capital. The fixed assets will be depreciated to a zero book value over the 3-year life of the project and have an estimated salvage value of $155,000. All of the net working capital will be recouped at the end of the project. The annual operating cash flow is $245,000 and the discount rate is 16 percent. What is the initial cash flow at year 0 for this project?

		-$172,000
		-$330,000
		-$342,000
		$152,000

2.Today, Strawberry Inc. is investing $300,000 in some new candy-making equipment. The company expects the cash flows to increase by $70,000 a year for the next three years and $95,000 a year for the following two years as a result of this investment. How long must the firm wait until it recovers all of its initial investment?

		3.95 years
		3.39 years
		4.12 years
		4.81 years

3.

A project you are considering requires an initial cash outlay of $675,000 for equipment. You expect to spend an additional $45,000 in the first year to cover costs as the project will produce negligible cash inflows for that year. During years 2 through year 6, you expect to receive cash inflows of $325,000 a year. What is the net present value of this project at a discount rate of 22 percent?

		$72,457.45
		$50,969.61
		$61,481.90
		$44,824.61