As of 1/1/03, World communications company is a telecommunications
company that has telecommunications equipment with a book value( cost
less accumulated depreciation) of $10,000,000,000. The company
believes that this equipment will produce $1,500,000,000 in income in
each of the next five years and at that point become technologically
obsolete and completely worthless. The company has a cost of capital
of 10%.

1.	Should the book value of this asset be reduced on World
Communications company as of 1/1/03?
2.	By how much should the book value of this asset be reduced?