The Johnson Research Organization, a nonprofit organization that does not pay taxes, is considering buying laboratory equipment with an estimated life of seven years so it will not have to use outsiders laboratories for certain types of work. The following are all of the cash flows affected by the decision: Use ExhibitA8 $6,500,000 Investment (outflow attime 0) Periodicoperating cash flows: 1,490,000 290,000 490,000 Annual cash savings because outside laboratories are notused Additional cash outflow for people and supplies to operate the equipment Salvage value after seven years, which is the estimated life of this project Discount rate 8% Required Calculate the net present value of this decision.(Round.P.V.factor te.desimalplacesJ Should the organization buy the equipment? ? Yes cNo Rush Corporation plans to acquire production equipmentfor $650,000 that will be depreciated for tax purposes as follows: year 1, $130,000: year 2, $220,000; and in each of years 3 through 5, $100,000 per year A 14 percent discount rate is appropriate for this asset, and the company's tax rate is 40 percent. Use ExhibitA& and ExhibitA9 Required: a. Compute the presentvalue of the tax shield resulting from depreciation. (Round Pv.factor.to.x b. Compute the presentvalue of the tax shield from depreciation assuming straight-line depreciation ($130,000 peryear). IR Star City is considering an investment in the community center that is expected to return the following cash flows: Use ExhibitA.8 YearNet Cash Flow S 38,000 68,000 98,000 118,000 This schedule includes all cash inflows fromthe project, which will also require an immediate 5218,000 cash outlay The city is tax-exempt therefore taxes need notbe considered Required a. What is the net present value of the projectif the appropriate discount rate is 25 percent? (Round pylactor to 3 decimal places. Negative amount should be indicated by a minus sign.) scountrate is 12 p