1) If an alternative has monthly payments of $10,000 a month for three years with a purchase price of $75,000 at the end of year three, what would the cash flow diagram look like? Select the correct choice from each pair of answers.

$120,000 EOY 1
$120,000 MOY 1

$120,000 EOY 2
$120,000 MOY 2

$120,000 EOY 3
$120,000 MOY 3

$75,000 EOY 3
$75,000 MOY 3

2) If an alternative has monthly payments of $5,000 a month for three years with a salvage value of $15,000 at the end of year three, what would the cash flow diagram look like? Select the correct choice from each pair of answers.

$60,000 outflow MOY 1
$60,000 inflow MOY 1

$60,000 outflow MOY 2
$60,000 inflow MOY 2

$60,000 outflow MOY 3
$60,000 inflow MOY 3

$15,000 outflow EOY 3
$15,000 inflow EOY 3

3) An alternative requires $35203 to be paid over the course of year 1, $75000 over year 2, and $40000 over year 3. All values are in constant dollars. Using the tables in the chapter, compute the NPV of this alternative. Round intermediate calculations to two decimal places.

a. $150,203

b. $144,644

c. $139,674

d. $142,873