OCF at year 1 (t=1) for a proposed project for company XYZ has the following information:
1) What is the project's operating cash flow for the first year (t=1)?
2) If this project would cannibalize other projects by $1,000,000 of cash low before taxes per year, how would this change the answer to part 1?
3) Ignore part 2. If the tax rate dropped to 30%, how would that change the answer to part 1?
The solution calculates the project's operating cash flow.