1. An asset used in a 4-year project falls in the 5-year MACRS class (MACRS Table) for tax purposes. The asset has an acquisition cost of $13,320,000 and will be sold for $2,960,000 at the end of the project.
Required: If the tax rate is 31 percent, what is the aftertax salvage value of the asset?
2. What are some advantages and disadvantages of investing in the following: stocks, bonds, and a savings account?