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Hyundai is considering opening a plant in two neighboring states. Option 1 : One state has a corporate tax rate of 1 0 percent. If

Hyundai is considering opening a plant in two neighboring states.
Option 1: One state has a corporate tax rate of 10 percent. If operated in this state, the plant is expected to generate $1,260,000 pretax profit.
Option 2: The other state has a corporate tax rate of 2 percent. If operated in this state, the plant is expected to generate $1,220,000 of pretax profit.
Required:
a. What is the after-state-taxes profit in the state with the 10% tax rate?
b. What is the after-state-taxes profit in the state with the 2% tax rate?
c. Which state should Hyundai choose?
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