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Richard is considering making a $5,000 investment during 2012 in a venture that its promoter promises will generate immediate tax benefits for him. Richard, who does not anticipate itemizing his deductions, is in the 33% marginal income tax bracket. If the investment is of a type that produces a tax credit of 30% of the amount of the expenditure, by how much will Richard's tax liability decline because of the investment?

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Accounting Basics, Accounting

Category:- Accounting Basics
Reference No.:- M9968816

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