Consider the example of Mezzo Diner in the text. Suppose that Mezzo qualifies for and decides to take advantage of a tax law that provides "bonus" depreciation on the investment. Assume that this allows Mezzo to deduct the cost of the investment, net of salvage value, in the first year of the investment. As a result, of course, no more depreciation is taken in years 2 through 5. Assume all other facts as in the text. Use Exhibit A.2.

Required:

a. What is the net present value of the investment assuming full expensing in the first year? (Round PV factor to 3 decimal places.)