Question no:2 (30 marks) ABC corporation is considering to purchase a new equipment that falls under the three year MACRS category. The cost if BD:500000. Earnings before depreciation and taxes for the next four years are: Year BD: 200000 Year 2 250000 100000 Year 4 80000 The firm is in 20% tax bracket and has 12 % cost of capital. Should it purchase the new equipment. (Hint: MACRS depreciation value year 1:0.333, 0.445, 0.148, 0.074 ) Year 3