At the beginning of 2020, an investor purchases 50,000 exchange-traded units of Seneca Energy Company, which is organized as a Master Limited Partnership.The investment cost $700,000.Per unit allocations of taxable income and cash distributions take place at the end of each year, as follows:

2020 2021 2022

Taxable income $0.80 $0.75 $0.90

Cash distributions 1.30 1.35 1.40

Taxable income is taxed at the investor's personal tax rate, while the excess cash distribution reduces the basis of the investment.At the time of sale, the basis reduction is taxed at the investor's personal rate, while the remaining gain is taxed at the capital gains rate.The investor's personal marginal tax rate is 30%, and the capital gains rate is 15%.The investor sells the investment for $1,000,000 at the end of 2022.

Required

a. schedule of the after-tax return, in dollars, for this investment, for each of the years 2020, 2021, and 2022.

b. Calculate the tax on the sale of the investment at the end of 2022.

c. Calculate the present value of the investor's savings from delaying the tax on excess cash distributions.Use a 5% risk-adjusted discount rate.