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5-7. Your firm is considering investing in a project to redose sosts by 556.000 annually. The equipment costs $183.000, had a 4-year tife (will be
5-7. Your firm is considering investing in a project to redose sosts by 556.000 annually. The equipment costs $183.000, had a 4-year tife (will be depreciated as a 3-year MACRS asset: 33\% for the Ist year. 45% for the 2 nd year, and 15% for the 3rd year), requires $8,000 initial cost in net working capital, and has a before-tax salvage value of $23,000. The discotint nate is 1006 . Tax rate is 21%6. 5. What's the OCF in year 1 ? 6. What's the Depreciation in year 2? 7. What's the NPV? Accept or Reject
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