N1 New equipment costing $35,000 has a 5 -year life and no salvage value. Benefits are expected to be $9000 per year. The equipment qualifies for 100% bonus depreciation. The firm has a 28% combined marginal income tax rate. What is the after-tax rate of return?
N1 New equipment costing $35,000 has a 5 -year life and no salvage value. Benefits are expected to be $9000 per year. The equipment qualifies for 100% bonus depreciation. The firm has a 28% combined marginal income tax rate. What is the after-tax rate of return?
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
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N1
New equipment costing
$35,000
has a 5 -year life and no salvage value. Benefits are expected to be
$9000
per year. The equipment qualifies for
100%
bonus
28%
combined marginal income tax rate. What is the after-tax
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