What is the cash flow from assets (project cash flow) in year ONE for this project? A firm is considering an expansion project that will last three years. The project requires an immediate purchase of a new equipment that costs $900,000. The equipment will be fully depreciated using straight-line method over the next three years. The resale price of the equipment at the end of year three is estimated to be $200,000. The project will generate annual sales of $750,000 and incur annual costs (all costs except depreciation expense) of $200,000 for each of the next three years. The project requires an immediate investment of $50,000 in NWC, which will be fully recovered in year 3. The corporate tax rate is 30%. $725,000 $475,000 $525,000 $175,000 What is the project cash flow in year 4 for this project? A project requires buying some fixed assets that cost $40,000 immediately. These fixed assets will be depreciated straight-line to zero over its 4-year life. The project also requires a net working capital investment of $5,000 up front. The investment in NWC will recovered fully at the end of the life of the project. The project generates OCF of $17,000 each of the next three years, and the fixed assets will be sold for $7,000 after the four years. Assume that the tax rate for the firm is 34%. $19,620 $29,000 $26,620 $21,620 Which of the following is NOT true? When the coupon rate on a bond equals the market interest rate, the bond will sell for par value regardless of its time-to-maturity. When a bond's coupon rate is greater than the market's required rate of return, the bond's price will be less than its par value. For two bonds otherwise identical but for coupon rate, the price of the lower coupon rate bond will be more sensitive to changes in market rates than that of the higher coupon rate bond. Bond prices and market interest rates move in opposite directions