Suppose a firm's tax rate is $35\%.$

a$.$ What effect would a $$9\mathrm{.}64$ million operating expense have on this year's earnings? What effect would it have on next year's earnings?

b$.$ What effect would an $$8\mathrm{.}70$ million capital expense have on this year's earnings if the capital is depreciated at a rate of $$1\mathrm{.}74$ million per year for five years? What effect

would it have on next year's earnings?

a$.$ What effect would a $$9\mathrm{.}64$ million operating expense have on this year's earnings?

Earnings would increase $($decline$)$ by $ million. $($Round to two decimal places, and use a negative number for a decline.$)$

What effect would it have on next year's earnings? $($Select the best choice below.$)$

A$.$ There would be no effect on next year's earnings.

B$.$ Next year's earnings will be affected by a decline of $$3\mathrm{.}37$ million.

C$.$ Next year's earnings will be affected by an increase of $$3\mathrm{.}37$ million.

D$.$ Next year's earnings will be affected by the same amount.

b$.$ What effect would an $$8\mathrm{.}70$ million capital expense have on this year's earnings if the capital is depreciated at a rate of $$1\mathrm{.}74$ million per year for five years? What effect

would it have on next year's earnings?

Earnings would be higher $($lower$)$ each year by $ million. $($Round to two decimal places, and use a negative number for a decline.$)$