21. McPherson Company must purchase a new milling machine. The purchase price is $50,000, including installation. The machine has a tax life of 5 years, and it can be depreciated according to the following rates. The firm expects to operate the machine for 4 years and then to sell it for $12,500. If the marginal tax rate is 40%, what will the after-tax salvage value be when the machine is sold at the end of Year 4? Year ou AWNA Depreciation Rate 0.20 0.30 0.20 0.13 0.11 0.06 a. $8,878 b. $9,345 c. $9,837 d. $10,355 e. $10,900 22. Westbrook's Painting Co. plans to issue a $1,000 par value, 20-year noncallable bond with an 7.00% annual coupon, paid semiannually. The company's marginal tax rate is 40.00%, but Congress is considering a change in the corporate tax rate to 30.00%. By how much would the component cost of debt used to calculate the WACC change if the new tax rate was adopted? a. 0.57% b. 0.61% c. 0.70% d. 0.76% e. 0.80%