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Question: An equipment costs $800,000 and has a service-life of 10 years with a salvage value of $20,000. The equipment will bring a before tax income of $200,000 every year. Annual operations and maintenance will be $10,000. The company uses straight line depreciation method and has a MARR of 12%. What is the after-tax present worth of this equipment, if the combined tax rate of the company is 34%?

a. $46,355

b. $64,788

c. $55,325

d. $82,250

Microeconomics, Economics

  • Category:- Microeconomics
  • Reference No.:- M92598283

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