XYZ is evaluating the Reno project. The project would require an initial investment of $133,000 that would be depreciated to $15,900 over 6 years using straight-line depreciation. The project is expected to have operating cash flows of $47,800 per year forever. XYZ expects the project to have an after-tax terminal value of $382,000 in 3 years. The tax rate is 30%. What is (X+Y)/Z if X is the project's relevant expected cash flow in year 3, Y is the project's relevant expected cash flow in year 4, and Z is the project's relevant expected cash flow in year 2?

Answers:-

		A number less than 8.49 or a rate greater than 12.72
		A number equal to or greater than 10.06 but less than 11.61
		A number equal to or greater than 12.31 but less than 12.72
		A number equal to or greater than 8.49 but less than 10.06
		A number equal to or greater than 11.61 but less than 12.31