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Your Company is considering a new project that will require $24,000 of new equipment at the start of the project. The equipment will have a
Your Company is considering a new project that will require $24,000 of new equipment at the start of the project. The equipment will have a depreciable life of 7 years and will be depreciated to a book value of $1,600 using straight-line depreciation. The cost of capital is 10%, and the firm's tax rate is 34%. Estimate the present value of the tax benefits from depreciation.
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