Use the Beyond the Page feature to access the Excel program for calculating the profitability of the Nodhead project. Now suppose that the cash flows from Nodhead's new supermarket are as follows:

a. Recalculate economic depreciation. Is it accelerated or decelerated?
b. Rework Tables 12.2 and 12.3 to show the relationship between
(i) The "true" rate of return and book ROI and
(ii) True EVA and forecasted EVA in each year of the project's life.
TABLE 12.2

TABLE 12.3

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Period Cash flows ($ thousands) 1,000 +298+298 +298 +138 138 140 Tear Cash flow Book value at start of year Book value at end of year 250 1,000 167 167 167 131 167 167 167 Book income Book ROI 167 130 -0.067 0.040 0.125 0.782 114 Tear PV at start of PV at end of year 1,000 1,000 Economic income 0.10 0.00 0.00 0.00 0.00 0.00 0.00