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Markov Manufacturing recently spent $15 million to purchase some equipment used in the manufacture of disk drives. The firm expects that this equipment will have

Markov Manufacturing recently spent $15 million to purchase some equipment used in the manufacture of disk drives. The firm expects that this equipment will have a useful life of five years, and its marginal corporate tax rate is 30%. The company plans to use straight-line depreciation.

a.What is the annual depreciation expense associated with this equipment?

b.What is the annual depreciation tax shield?

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