Refer to Problem 6 79 The alternatives all have a MACRS (GDS) property class of three years If the effective income tax rate is 40 and the after tax MARR (1 0 4)(12 ) 7 2 per year, which alternative should be recommended Is this the same recommendation you made when the alternatives were analyzed o...

Aftertax MARR 72 per year Choose alternative B to maximize after ...

Refer to Problem 6-79. The alternatives all have a MACRS (GDS) property class of three years. If

Question:

Refer to Problem 6-79. The alternatives all have a MACRS (GDS) property class of three years. If the effective income tax rate is 40% and the after-tax = (1 - 0.4)(12%) = 7.2% per year, which alternative should be recommended? Is this the same recommendation you made when the alternatives were analyzed on a before-tax basis?
MARR
Minimum Acceptable Rate of Return (MARR), or hurdle rate is the minimum rate of return on a project a manager or company is willing to accept before starting a project, given its risk and the opportunity cost of forgoing other...