Consider an asset with the following cash flows: Year 0 Year 1 Year 2 Year 3 Cash flows ($ millions) 27 11.70 10.80 9.90 The firm uses straight-line depreciation. Thus, for this project, it writes off $9 million per year in years 1, 2, and 3. The discount rate is 10%. Complete the following table. Does the economic depreciation equal the book depreciation? Is the book rate of return the same in each year? Is the project's book profitability its true profitability?

Complete the following table. (Leave no cells blank - be certain to enter "0" wherever required. Round your cash flow, economic income, economic rate of return, book income, and book rate of return answers to 2 decimal places. All other answers should be rounded to the nearest whole number.Input the rates of return as decimal values, not percents and other answers in millions not in dollars. Negative answers should be indicated with a minus sign.)

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	Year 1	Year 2	Year 3
Cash flow	11.70selected answer correct	10.80selected answer correct	9.90selected answer correct
PV at start of year	not attempted	not attempted	not attempted
PV at end of year	not attempted	not attempted	0selected answer correct
Change in PV	not attempted	not attempted	not attempted
Economic depreciation	not attempted	not attempted	not attempted
Economic income	not attempted	not attempted	not attempted
Economic rate of return	not attempted	not attempted	not attempted
Book depreciation	14selected answer incorrect	not attempted	not attempted
Book income	not attempted	not attempted	not attempted
Book rate of return	not attempted