Question \#19 - \#20 will use the following setup. Cyclone Industrial is considering a project with an initial cost of $3.5 million to purchase a piece of equipment, which will be depreciated straight-line to a book value of $0 over its 5 -year life. - The new equipment will reduce the operating costs by $850,000 per year (This is a pre-tax figure.) - There is an initial investment in the net working capital (NWC) of $450,000 which will be maintained at this level until the NWC is recovered in the end. - The marginal tax rate is 35%. What are the operating cash flows (OCF) over the lifetime of the equipment? $552,500 per year from year 1 to year 5 $797,500 per year from year 1 to year 5 $1,252,500 per year from year 1 to year 5 $762.500 per year from year 1 to year 5