mation and NPV for Unequal Lives_ST eBook Kristin is evaluating a capital budgeting project that should last for 4 years. The project requires $800,000 of equipment. She is unsure what depreciation method to use in her analysis, straight-line or the 3-year MACRS accelerated method. Under straight-line depreciation, the cost of the equipment would be depreciated evenly over its 4-year life (ignore the half-year convention for the straight-line method). The applicable MACRS depreciation rates are 33%, 45%, 15%, and 7%. The company's WACC is 9%, and its tax rate is 40%. a. What would the depreciation expense be each year under each method? Round your answers to the nearest cent. Year Scenario 1 (Straight-Line) Scenario 2 (MACRS) 1 $ 72727.27 96000 3 2 $ 66115.70 > 119008.26 3 $ 60105.18 36063.11 15299.50 54641.08 b. Which depreciation method would produce the higher NPV? MACRS How much higher would the NPV be under the preferred method? Round your answer to the nearest cent. $ -12781.64