Please answer the two questions

1. What is CF at time 0?

2. What is the salvage value?

0 1 2 3 4 5 Operating cost reduction 30,000 every year, cost saving + by 5,000 Year 5 cost + by 10,000 ANWC 5,000 Sales (costs) (dep) EBIT (tax) 30,000 (20,000) 10,000 (3,500) 6,500 35,000 (20,000) 15,000 (5,250) 9,750 40,000 (20,000) 20,000 (7,000) 13,000 45,000 (20,000) 25,000 (8,750) 16,250 35,000 (20,000) 15,000 (5,250) 9,750 Cost of Equipment (100,000) Dep per year - SL 5 years (20,000) After YS, Market Value of 20,000 Book Value at the end of Year 5 Net Income + dep OCF 20,000 26,500 20,000 29,750 20,000 33,000 20,000 36,250 20,000 29,750 Buy/Build ANWC ATSV (100,000) 5,000 (5,000) 13,000 37,750 ANWC ATSV FCF FCF (95,000) 26,500 29,750 33,000 36,250 Assuming a rate of = 16% NPV = $9,089.45