1. Andrew (30% tax rate; 11% discount rate) pays an expense of 1,000. He is able to structure the transaction such that he can take the deduction now, but disburse the actual cash to pay the expense 2 years later. Considering the entire multi-year period discussed, what is the total after-tax cost of this expense?

1. -700
2. -512
3. +654.2
4. -756.4
5. None of the Above