Firm E must choose between two business opportunities. Opportunity 1 will generate an $16,800 deductible loss in year 0,$10,500 taxable income in year 1 , and $42,000 taxable income in year 2 . Opportunity 2 will generate $11,500 taxable income in year 0 and $10,500 taxable income in years 1 and 2. The income and loss reflect before-tax cash inflow and outflow. Firm E uses a 5 percent discount rate and has a 40 percent marginal tax rate over the three-year period. Use Appendix A and Appendix B. Required: a1. Complete the tables below to calculate NPV. a2. Which opportunity should Firm E choose? b1. Complete the tables below to calculate NPV. Assume Firm E's marginal tax rate over the threeyear period is 15 percent. b2. Which opportunity should Firm E choose? c1. Complete the tables below to calculate NPV. Assume Firm E's marginal tax rate is 40 percent in year 0 but only 15 percent in years 1 and 2 . c2. Which opportunity should Firm E choose? Complete this question by entering your answers in the tabs below. Complete the tables below to calculate NPV. Note: Cash outflows should be indicated by a minus sign. Round discount factor(s) to 3 decimal places, calculations and final answers to the nearest whole dollar amount. Which opportunity should Firm E choose? \begin{tabular}{|c|c|c|c|c|c|c|} \hline \multirow{2}{*}{ Opportunity 1 : } & \multicolumn{2}{|c|}{ Year 0} & \multicolumn{2}{|c|}{ Year 1} & \multicolumn{2}{|c|}{ Year 2} \\ \hline & & & & & & \\ \hline Before-tax cash flow & & & & & & \\ \hline Tax (cost) or savings & & & & & & \\ \hline Net cash flow & $ & 0 & $ & 0 & $ & 0 \\ \hline Discount factor (5%) & & & & & & \\ \hline Present value & $ & 0 & & & & \\ \hline NPV & & & & & & \\ \hline Opportunity 2 : & & & & & & \\ \hline Before-tax cash flow & & & & & & \\ \hline Tax cost & & & & & & \\ \hline Net cash flow & $ & 0 & $ & 0 & $ & 0 \\ \hline Discount factor (5%) & & & & & & \\ \hline Present value & $ & 0 & & & & \\ \hline NPV & & & & & & \\ \hline \end{tabular} Which opportunity should Firm E choose? \begin{tabular}{|c|c|c|c|c|c|c|} \hline \multirow{2}{*}{ Opportunity 1 : } & \multicolumn{2}{|c|}{ Year 0} & \multicolumn{2}{|c|}{ Year 1} & \multicolumn{2}{|c|}{ Year 2} \\ \hline & & & & & & \\ \hline Before-tax cash flow & & & & & & \\ \hline Tax (cost) or savings & & & & & & \\ \hline Net cash flow & $ & 0 & $ & 0 & $ & 0 \\ \hline Discount factor (5%) & & & & & & \\ \hline Present value & $ & 0 & & & & \\ \hline NPV & & & & & & \\ \hline Opportunity 2 : & & & & & & \\ \hline Before-tax cash flow & & & & & & \\ \hline Tax cost & & & & & & \\ \hline Net cash flow & $ & 0 & $ & 0 & $ & 0 \\ \hline Discount factor (5%) & & & & & & \\ \hline Present value & $ & 0 & & & & \\ \hline NPV & & & & & & \\ \hline \end{tabular} Which opportunity should Firm E choose? Firm E must choose between two business opportunities. Opportunity 1 will generate an $16,800 deductible loss in year 0,$10,500 taxable income in year 1 , and $42,000 taxable income in year 2 . Opportunity 2 will generate $11,500 taxable income in year 0 and $10,500 taxable income in years 1 and 2. The income and loss reflect before-tax cash inflow and outflow. Firm E uses a 5 percent discount rate and has a 40 percent marginal tax rate over the three-year period. Use Appendix A and Appendix B. Required: a1. Complete the tables below to calculate NPV. a2. Which opportunity should Firm E choose? b1. Complete the tables below to calculate NPV. Assume Firm E's marginal tax rate over the threeyear period is 15 percent. b2. Which opportunity should Firm E choose? c1. Complete the tables below to calculate NPV. Assume Firm E's marginal tax rate is 40 percent in year 0 but only 15 percent in years 1 and 2 . c2. Which opportunity should Firm E choose? Complete this question by entering your answers in the tabs below. Complete the tables below to calculate NPV. Note: Cash outflows should be indicated by a minus sign. Round discount factor(s) to 3 decimal places, calculations and final answers to the nearest whole dollar amount. Which opportunity should Firm E choose? \begin{tabular}{|c|c|c|c|c|c|c|} \hline \multirow{2}{*}{ Opportunity 1 : } & \multicolumn{2}{|c|}{ Year 0} & \multicolumn{2}{|c|}{ Year 1} & \multicolumn{2}{|c|}{ Year 2} \\ \hline & & & & & & \\ \hline Before-tax cash flow & & & & & & \\ \hline Tax (cost) or savings & & & & & & \\ \hline Net cash flow & $ & 0 & $ & 0 & $ & 0 \\ \hline Discount factor (5%) & & & & & & \\ \hline Present value & $ & 0 & & & & \\ \hline NPV & & & & & & \\ \hline Opportunity 2 : & & & & & & \\ \hline Before-tax cash flow & & & & & & \\ \hline Tax cost & & & & & & \\ \hline Net cash flow & $ & 0 & $ & 0 & $ & 0 \\ \hline Discount factor (5%) & & & & & & \\ \hline Present value & $ & 0 & & & & \\ \hline NPV & & & & & & \\ \hline \end{tabular} Which opportunity should Firm E choose? \begin{tabular}{|c|c|c|c|c|c|c|} \hline \multirow{2}{*}{ Opportunity 1 : } & \multicolumn{2}{|c|}{ Year 0} & \multicolumn{2}{|c|}{ Year 1} & \multicolumn{2}{|c|}{ Year 2} \\ \hline & & & & & & \\ \hline Before-tax cash flow & & & & & & \\ \hline Tax (cost) or savings & & & & & & \\ \hline Net cash flow & $ & 0 & $ & 0 & $ & 0 \\ \hline Discount factor (5%) & & & & & & \\ \hline Present value & $ & 0 & & & & \\ \hline NPV & & & & & & \\ \hline Opportunity 2 : & & & & & & \\ \hline Before-tax cash flow & & & & & & \\ \hline Tax cost & & & & & & \\ \hline Net cash flow & $ & 0 & $ & 0 & $ & 0 \\ \hline Discount factor (5%) & & & & & & \\ \hline Present value & $ & 0 & & & & \\ \hline NPV & & & & & & \\ \hline \end{tabular} Which opportunity should Firm E choose