Spherical Manufacturing recently spent $$17$ million to purchase some equipment used in the

manufacture of disk drives. This equipment has a CCA rate of $45\%$ and Spherical's marginal corporate

tax rate is $28\%.$

a$.$ What are the annual CCA deductions associated with this equipment for the first five years?

b$.$ What are the annual CCA tax shields for the first five years?

c$.$ What is the present value of the first five CCA tax shields if the appropriate discount rate is $8\%$

per year?

d$.$ What is the present value of all the CCA tax shields assuming the equiment is never sold and the

appropriate discount rate is $8\%$ per year?

e$.$ How might your answer to part $($d$)$ change if Spherical anticipates that its marginal corporate tax rate

will increase substantially over the next five years?

a$.$ What are the annual CCA deductions associated with this equipment for the first five years?

The CCA deduction for year $1$ is $

$($Round to the nearest dollar.$)$