Suppose that Sudbury Mechanical Drifters is proposing to invest $11.4 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 10%. a. What is the present value of Sudbury's depreciation tax shields? (Enter your answers in millions rounded to 1 decimal place.) Straight-line Schedule Year 1 Year 2 Year 3 Year 4 Year 5 Year 6 Year 7 Year 8 Year 9 Year 10 Total Straight-line, 10-year $ 1.1 $ 1.1 $ 1.1 $ 1.1 $ 1.1 $ 1.1 $ 1.1 $ 1.1 $ 1.1 $ 1.1 $ 11.4 Tax Shields at 35% Tc $ 0.4 $ 0.4 $ 0.4 $ 0.4 $ 0.4 $ 0.4 $ 0.4 $ 0.4 $ 0.4 $ 0.4 $ 4.0 PV (Tax Shields) at 10% $ 0.4 $ 0.3 $ 0.3 $ 0.3 $ 0.2 $ 0.2 $ 0.2 $ 0.2 $ 0.2 $ 0.2 $ 2.5 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.) Double decline Schedule Year 1 Start of Year Book Value Depreciation $ 11.4 $ $ 2.3 $ 9.1 $ 1.8 $ Year 2 Year 3 Year 4 7.3 $ Year 5 Year 6 Year 7 Year 8 Year 9 Year 10 Total 5.8 $ 4.7 $ 3.7 $ 3.0 $ 2.2 1.5 $ 1.2 $ 0.9 $ 0.7 Tax Shields at 35% Tc $ 0.8 $ 0.6 $ 0.5 $ 0.4 $ 0.3 $ 0.3 PV (Tax Shields) at 10% $ 0.7 $ 0.5 $ 0.4 $ 0.3 $ 0.2 $ 0.1 $ 0.1 $ 0.1 $ 0.1 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 $ 4.0