Q2Find the original cash outflow (at t=0)

Q3Find cash flow at t=1\

Q4: Find cash flow at t=2

Q5:Find the combined cash flow at t=4 (including the PV at t=4 of the effect of this project on taxes from t=5 until infinity

XYZ inc. considers an investment project that requires $500,000 in new equipment and $40,000 in extra NWC at the beginning of the project. The NWC will need to be increase by another $5,000 at the end of year t=2 and it will remain at the $45,000 level until the project is completed. The projects will lead to an increase in operating pre-tax net revenue of $180,000 per year and will last for 4 years. At the end of the project (beginning of year t=5), the equipment can be sold for the salvage value of $200,000. The equipment belongs to the CCA class with d=30%, the corporate income tax rate is 40%, and the cost of capital is 8% Problem 1 (2 points): Write down the UCC/CCA table. Use the format below: Year UCC (beginning of the year) CCA UCC (end of the year) 1 2. 3 4