Question
Suppose that Sudbury Mechanical Drifters is proposing to invest $10 million in a new factory. It can depreciate this investment straight-line over 5 years. The
Suppose that Sudbury Mechanical Drifters is proposing
to invest $10 million in a new factory. It can depreciate this investment straight-line over
5 years. The tax rate is 21%, and the discount rate is 10%.
What is the present value of the depreciation tax shield?
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Entrepreneurial Finance
Authors: J. Chris Leach, Ronald W. Melicher
6th edition
1305968352, 978-1337635653, 978-1305968356
