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step by step solution XYZ is evaluating a project that would require the purchase of a piece of equipment for $580,000 today. During year 1

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XYZ is evaluating a project that would require the purchase of a piece of equipment for $580,000 today. During year 1 , the project is expected to have relevant revenue of $780,000, relevant costs of $210,000, and relevant depreciation of $133,000. XYZ would need to borrow $580,000 today to pay for the equipment and would need to make an interest payment of $36,000 to the bank in 1 year. Relevant net income for the project in year 1 is expected to be $326,000. What is the tax rate expected to be in year 1 ? Selected Answer: A rate less than 21.28% or a rate greater than 48.94% Answers: A rate equal to or greater than 26.54% but less than 30.86% A rate less than 21.28% or a rate greater than 48.94% A rate equal to or greater than 21.28% but less than 26.54% A rate equal to or greater than 30.86% but less than 39.01% A rate equal to or greater than 39.01% but less than 48.94%

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