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lilricemunch lilricemunch
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A month ago
Suppose a project requires a capital investment of $300,000. The project will last for six years, at which time the asset will be sold for $90,000. The asset is a Class 8 asset, with a CCA rate of 20%. The firm's marginal tax rate is 40%. The firm's required rate of return is 8%. Assume the asset class remains open after the asset is sold. What is the present value of the CCA tax savings for the project assuming half-year rule is applicable for CCA in year 1?

▸ $63,472.64

▸ $66,335.32

▸ $65,950.56

▸ $66,720.08
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Corporate Finance

Corporate Finance


Edition: 5th
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duankong-feiduankong-fei
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lilricemunch Author
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A month ago
Thank you, thank you, thank you!
alpheratz
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Helped a lot
jbarnett14
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2 hours ago
Brilliant ツ
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