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Suppose that Sudbury Mechanical Drifters is proposing to invest $40 million in a new factory. It can depreciate this investment straight-line over 4 years. The

Suppose that Sudbury Mechanical Drifters is proposing to invest $40 million in a new factory. It can depreciate this investment straight-line over 4 years. The tax rate is 21%, and the discount rate is 8%. Question: What is the present value of the depreciation tax shield? Multiple Choice 4.80 6.96 6.06 8.4 5.61.

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