Garida Co$.$ is considering an investment that will have the following sales, variable costs,

and fixed operating costs:

This project will require an investment of $$10,000$ in new equipment. Under the new tax law, the

equipment is eligible for $100\%$ bonus deprecation at $t=0,$ so it will be fully depreciated at the

time of purchase. The equipment will have no salvage value at the end of the project's four$-$year

life. Garida pays a constant tax rate of $25\%,$ and it has a weighted average cost of capital $($WACC$)$

of $11\%.$ Determine what the project's net present value $($NPV$)$ would be under the new tax law.

Which of the following most closely approximates what the project's net present value $($NPV$)$ would

be under the new tax law?$($Hint: Round your final answer to two decimal places and choose the

value that most closely matches your answer.$)$

$$58,986\mathrm{.}21$

$$67,834\mathrm{.}14$

$$70,783\mathrm{.}45$

$$47,188\mathrm{.}97$

Which of the of the following most closely approximates what the project's NPV would be when

using straight$-$line depreciation? $($Hint: Round your final answer to two decimal places and choose

the value that most closely matches your answer.$)$

$$73,031\mathrm{.}55$

$$58,425\mathrm{.}24$

$$67,189\mathrm{.}03$

$$55,503\mathrm{.}98$

Using the

depreciation method will result in the highest NPV for the project.

No other firm would take on this project if Garida turns it down. Which of the following most

closely approximates how much Garida should reduce the NPV of this project, assuming it is

discovered that this project would reduce one of its division's net after$-$tax cash flows by $$300$ for

each year of the four$-$year project? $($Hint: Round your final answer to two decimal places and

choose the value that most closely matches your answer.$)$

$$558\mathrm{.}44$

$$791\mathrm{.}12$

$$930\mathrm{.}73$

$$1,023\mathrm{.}80$