2.Consider a project with an initial investment of $60,000, a 6 year usefule life (and study period), and a $10,000 salvage value. You expect an annual net revenue of $15,000 (before tax), a MARR before tax of 15.3%, and an effective tax rate of 35%. The capital equipment is to be depreciated using MACRS GDS and a 3 year class life. Develop the after-tax cash flows and draw the cash flow diagram.

3.Develop the after-tax cash flows for the project of problem 2 using a 4 year class life and MACRS ADS. Draw the after-tax cash flow diagram

PROBLEM 3