2. Discuss the effects of profitability and current cash flow on investment decisions. Hints: Discuss your answers in the context of the newinvestment functions Define the present value of expected future profits, V(n). What does it represent, profitability or current cash flow? What are static expectations? Derive an equation for VCIT ) assuming static expectations. How does I, respond to changes in V(T)? How does I, respond to changes in the user cost of capital, rt+6? what does the rate of profit, represent, profitability or current cash flow? what is n, a function of? 2. Discuss the effects of profitability and current cash flow on investment decisions. Hints: Discuss your answers in the context of the newinvestment functions Define the present value of expected future profits, V(n). What does it represent, profitability or current cash flow? What are static expectations? Derive an equation for VCIT ) assuming static expectations. How does I, respond to changes in V(T)? How does I, respond to changes in the user cost of capital, rt+6? what does the rate of profit, represent, profitability or current cash flow? what is n, a function of