Keira Knightley Company buys a piece of equipment for $36,442 that will last for 7 years. The equipment will generate cash flows of $7,000 per year and will have no salvage value at the end of its life. Ignore taxes unless told to include them. What is the net present value using a 12% cost of capital? A $2,681 B. $4,495 C. ($2,681) D. ($4,495) 13. What is the internal rate of return? A. 14% B. 12% C. 10% D. 8% 14. Using straight-line depreciation over the life of the asset, what is the after tax cash flow in year 3? Assume a 30% tax rate and that the original cash flow was before tax. A. $4,900 B. $1,794 C. $1,256 D. $6,462 15. What is the payback period? A. 5.2 years B. 5.2% C. 520% D. 5.2 times