NextToo is considering an investment that will does not require any equipment, but will require putting up some cash of $1,200 as working capital and last for two years. At the end of the two years, NextToo will get the $1,200 back. The investment will pay $1.000 at the end of each of the two years before taxes. Taxes are 30%. NextToo requires a 10% return on investments. Some present value factors are available: Periods Present value of $1 Present value of an annuity. 10% 10% 0.909 0.909 2 0.826 1.736 3 0.751 2.487 1 What is the after-tax Net Present Value of the investment? I think the answer is available within a dollar or so. The way I see it, there is no depreciation because there is no equipment. Taxes are levied on the entire $1,000 each year. In addition, no taxes are levied on the $1,200 return of working capital, because that's just your money back again. It isn't profit