1)Marshall Corporation is making a $ 103,050 investment in equipment with a 5-year life. The company uses the straight-line method of depreciation and has a tax rate of 20 percent. The company's required rate of return is 11 percent. Click here to view factor tables What is the present value of the tax savings related to depreciation of the equipment? (Round present value factor calculations to 4 decimal places, e.g. 1.2151 and final answer to 0 decimal place, e.g. 125. Enter negative amounts using either a negative sign preceding the number e.g. -45 or parentheses e.g. (45).) ?

2)Monty Hardy recently rejected a $22,000,000, five-year contract with the Vancouver Seals hockey team. The contract offer called for an immediate signing bonus of $8,250,000 and annual payments of $2,750,000. To sweeten the deal, the president of player personnel for the Seals has now offered a $24,050,000, five-year contract. This contract calls for annual increases and a balloon payment at the end of five years.

Year 1		$2,750,000
Year 2		2,830,000
Year 3		2,910,000
Year 4		2,990,000
Year 5		3,220,000
Year 5 balloon payment		9,350,000
Total		$24,050,000

Suppose you are Hardy's agent and you wish to evaluate the two contracts using a required rate of return of 15 percent. In present value terms, how much better is the second contract? (Round present value factor calculations to 4 decimal places, e.g. 1.2151 and final answers to 0 decimal places, e.g. 125. Enter negative amounts using either a negative sign preceding the number e.g. -45 or parentheses e.g. (45).)

Present value of old contract		enter a dollar amount?
Present value of new contract		enter a dollar amount?