1. What is the present value at a 10 percent discount rate of the depreciation tax shield for a firm in the 35 percent tax bracket that purchases a $50,000 asset being depreciated at 10 percent declining balance with a half-year rule?

		$12,430
		$37,908
		$10,023
		$8352.3

2. A firm with 60 percent of sales going to variable costs, $1.5 million fixed costs, and $600,000 depreciation would show what accounting profit with sales of $3 million? Ignore taxes.

		$700,000 loss
		$800,000 Loss
		$900,000 loss
		$600,000 loss

3. Which of the following techniques may be more appropriate to analyze projects with interrelated variables?

		Sensitivity analysis
		DOL analysis
		Break-even analysis
		Scenario analysis

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