Suppose that Sudbury Mechanical Drifters is proposing to invest $10.4 million in a new factory. It can depreciate this investment straight-line over 10 years. The tax rate is 35%, and the discount rate is 12% a. What is the present value of Sudbury's depreciation tax shields? (Enter your answers in millions rounded to 1 decimal place.) Answer is complete but not entirely correct Year Year Year 3 Year 4 Year 5 Year Year Year 8 Year Year 10 Straight-line Schedule Total 1 6 9 2 7 Straight-line, 10-year $ 1.0 1.0 1.0 $ 1.0 $ 1.0 $ 1.0 $ 1.0 $ 1.0 $ 1.0 $ 1.0 $ 1.0 $ 0.4 $ 0.4 $ 0.4 $ 0.4 $ 0.4 $ 0.4 $ 3.6 Tax Shields at 35% Tc $ 0.4 $ 0.4 $ 0.4 $ 0.4 $ 0.1 $ 0.3 $ 0.3 $ 0.2 $ 0.2 $ 0.2 $ 0.2 $ 0.1 $ 0.3 $ 0.1 $ 2.0 PV (Tax Shields) at 12% b. Suppose that the government allows companies to use double-declining-balance depreciation with the option to switch at any point to straight-line. Now what is the present value of the depreciation tax shields? (Enter your answers in millions rounded to 1 decimal place.) Answer is not complete. Year Year Year Year Year Year 6 Year Year 8 Year Year 10 Total Double decline Schedule 1 4 5 9 2 7 Start of Year Book Value $ 10.4 $10.4 $10.4 $ 10.4 10.4 $ 10.4 $ 10.4 $ 10.4 (10.4 $10.4 104.0 Depreciation Tax Shields at 35% Tc PV (Tax Shields) at 12% c. What would be the present value of the tax shield if the government allowed Sudbury to write-off the factory immediately? (Enter your answer in millions rounded to 1 decimal place.) Percent value of depreciation tax shields