[en] As a result of work performed under the first year of this contract, the fundamental MHD processes that occur in the RFP have been identified. These processes have been correlated with experimental observations, and an assessment of their effect on transport and confinement has begun. Analytic studies have provided insight into the conditions necessary for dynamo action. Specific accomplishments during the first year of performance include: (a) the three-dimensional, compressible MHD code SPECTR3 and its associated post-processors were developed and brought into production; (b) SPECTR3 was used to identify, for the first-time, the fundamental nonlinear MHD processes that occur in the RFP; (c) because of these results, a model explaining many of the experimental observations on ZT-40M was given; (d) a three-dimensional incompressible MHD code INCOMPR was written and debugged. This code is now ready for production; (e) a reduced computational model for the study of low-frequency current drive in the RFP was developed; (f) analytic studies of the helical dynamo in the RFP yielded necessary conditions, under certain circumstances, for the existence of the dynamo; (g) statistical studies of the stochastic regions appearing in the numerical simulations produced an upper limit on the degree of stochasticity to be expected in the RFP, and its potential impact on transport