Your firm needs a machine which costs 270000 and requires


Your firm needs a machine which costs $270,000, and requires $42,000 in maintenance for each year of its 7 year life. After 3 years, this machine will be replaced. The machine falls into the MACRS 7-year class life category. Assume a tax rate of 40% and a discount rate of 16%. What is the depreciation tax shield for this project in year 7?

$18,889.20 $28,334 $47,223 $7,555.68

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Financial Management: Your firm needs a machine which costs 270000 and requires
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