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Suppose an owner pays $800 million to purchase a football team that earns operating profits of $200 million per year. The new owner claims that
Suppose an owner pays $800 million to purchase a football team that earns operating profits of $200 million per year. The new owner claims that $800 million of this price is for the players, which he can depreciate using straight-line depreciation over 10 years. If the team pays corporate profit taxes of 39 percent, how much does the depreciation of the players save the owner? Show your work
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