3-2 Your boss tells you that accounting has generated the following numbers for a compressor in- stallation, and he wants you to determine the after tax discounted net cash flow to investment ratio assuming mid-year discounting and an 18% per year discount rate (annual compounding). The first year is one year long. The required investment is $100,000 at the beginning of the project. What is the discounte profit to investment ratio? Gross Income 100,000 90,000 80,000 60,000 Direct Costs 20,000 20,000 20,000 20,000 Federal Income Tax 17,000 20,000 16,000 4,000 Year Depreciation 25,000 25,000 25,000 25,000 2 3-3 Calculate the modified DCFROR and standard DCFROR for the following proposed water flood nstallationto the nearest whole percent. Your average reinvestment opportunity rate is 2%. Assume year end discounting. All amounts are in thousands of dollars. Net Operating Year 0 Investment 800 0 500 0 0 Income 900 400 4 200