Corporation VB was formed in 2021. Immediately prior to year-end, VB is considering a $500,000 deductible expenditure. It can either make the expenditure before the end of 2021, or wait until 2022. However, if it waits, the cost of the expenditure will increase to $525,000. Before considering this expenditure, VB has the following projected pretax cash flows and taxable income for 2021, 2022, and 2023. Use Appendix A. 2021 2022 2023 Taxable income and pretax cash flow $ 120,000 $ 400,000 $ 700,000 a. Using a 5 percent discount rate, compute the NPV of VB's after-tax cash flows if the expenditure is in 2021. b. Using a 5 percent discount rate, compute the NPV of VB's after-tax cash flows if the expenditure is in 2022. c. Based on your calculations, when should VB make this expenditure? Present Value of $1 Periods 3% 4% 5% 6% 7% 8% 9% 1 .971 .962 .952 .943 .935 .926 .917 2 .943 .925 .907 .890 .873 .857 .842 3 .915 .889 .864 .840 .816 .794 .772 4 .888 .855 .823 .792 .763 .735 .708 5 .863 .822 .784 .747 .713 .681 .650 6 .837 .790 .746 .705 .666 .630 .596 7 .813 .760 .711 .665 .623 .583 .547 8 .789 .731 .677 .627 .582 .540 .502 9 .766 .703 .645 .592 .544 .500 .460 10 .744 .676 .614 .558 .508 .463 .422 11 .722 .650 .585 .527 .475 .429 .388 12 .701 .625 .557 .497 .444 .397 .356 13 .681 .601 .530 .469 .415 .368 .326 14 .661 .577 .505 .442 .388 .340 .299 15 .642 .555 .481 .417 .362 .315 .275 16 .623 .534 .458 .394 .339 .292 .252 17 .605 .513 .436 .371 .317 .270 .231 18 .587 .494 .416 .350 .296 .250 .212 19 .570 .475 .396 .331 .277 .232 .194 20 .554 .456 .377 .312 .258 .215 .178