1. A project has an initial requirement of $300,000 for fixed assets and $20,000 for net working capital. The fixed assets will be depreciated to a zero book value over the 3-year life of the project and have an estimated salvage value of $100,000. All of the net working capital will be recouped at the end of the project. The annual operating cash flow is $250,000 and the discount rate is 14 percent. What is the initial cash flow at year 0 for this project?

   		-$320,000
   		-$350,000
   		-$370,000
   		-$250,000

2. Golf Club is considering adding a miniature golf course to its facility. The course would cost $44,000, would be depreciated on a straight-line basis over its 4-year life, and would have a zero salvage value. The estimated income from the golfing fees would be $33,000 a year with $9,000 of that amount being variable cost. The fixed cost would be $5,000. The project will require $4,000 of net working capital, which is recoverable at the end of the project. What is the operating cash flow of this project for year 1 to year 4 at a tax rate of 20 percent?

   		$17,400
   		$15,100
   		$16,992
   		$14,154

3. You are considering an investment for which you require a 10 percent rate of return. The investment will cost $55,000 and produce cash inflows of $10,000 a year for 9 years. Should you accept this project based on its internal rate of return? Why or why not?

   		no; because the IRR is 9.17 percent
   		yes; because the IRR is 9.17 percent
   		yes; because the IRR is 11.17 percent
   		no; because the IRR is 11.17 percent