1,A firm has an expected free cash flow of $4,864,869 by the end of 2018 that is expected to be constant at this level beyond this year forever.

A project has an initial cost of $1,000,000 and is expected to last for 2 years. In year 1, depreciation charge will be $100,000 and earnings are expected to be $195,700. In year 2, depreciation will be $100,000 and earnings are expected to be $210,934. Assume the required return is 12%. What is the value of this project? (Please ignore the $ sign when submitting your answer as the system will not read it).

3,