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Question: A high-pressure reactor vessel in a pharmaceutical company was purchased for $200,000. It has a useful life of 10 years, and the vessel can be sold for $30,000 at that time. The vessel will be depreciated with the MACRS method (its class life is 5 years). Annual net cash flow (revenue less expenses) is $200,000 per year over the useful life. The effective income tax rate is 40%. What is the after-tax cash flow of the vessel at the end of year 10?

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Category:- Basic Finance
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