1. Calculate the NPV of some personal investment decision, such as buying a washing machine instead of using the soap with the hand or replacing an old car with a new one. Ignore the extra convenience of the new asset. Just focus on the cash costs and benefits.
2. Discuss the following statement: We dont want individual plant managers to get involved in the firms tax position. So instead of telling them to take the pretax cash flows and discount rate of 10% we just tell them to take the pretax cash flows and discount at 15%. With a 35% tax rate, 15% pretax generates approximately 10% after tax.