a) Mr. Basel made an investment that will generate the following before-tax cash flows over a three-year period:

	Year 0			Year 1				Year 2
Taxable revenue	$16,000			$23,000				$33,000
Deductible expenses	$(5,000	)		$(6,000	)			$(7,500	)
Nondeductible expenses	$(1,200	)		$(2,000	)			$(4,300	)

Assuming that any tax losses will be fully deductible, show your calculation of Mr. Basels NPV related to this investment. Mr. Basels marginal tax rate is 20% each year, and he uses a 6% discount rate.

b) As an alternative, Mr. Basel is considering a different investment that will generate the following before-tax cash flows over the same three-year period:

	Year 0			Year 1				Year 2
Taxable revenue	$20,000			$19,000				$68,000
Deductible expenses	$(5,000	)		$(39,000	)			$(7,500	)
Nondeductible expenses	$(1,200	)		$(2,000	)			$(4,300	)

Assuming that any tax losses will be fully deductible, show your calculation of Mr. Basels NPV related to this alternative investment. Mr. Basels marginal tax rate is 20% each year, and he uses a 6% discount rate.