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5. Firm Q is about to engage in a transaction with the following cash flows over a three-year period: (not taxable) Year 0 Year 1 Year 2 $10,000 $12,500 $18,000 Revenue Received Deductible expenses Nondeductible expenses (3,400 (5,000 (7,000 (800 (1,100 -0- If the firm's marginal tax rate over the three-year period is 35% and its discount rate is 10%, compute the net present value of the transaction. (use the present value table) Work this problem in the following order: 1) Calculate the tax cost by subtracting only the deductible expenses from revenue and multiplying the net amount by the marginal tax rate. 2) Subtract all expenses, including deductible as well as nondeductible expenses and the tax liability. 3) Discount year 1 by 1 period and year 2 by 2 periods, do not discount year 0. 4) Add up the net cash flows for all three years