2 6) Suppose you have an asset with a basis of $100,000. Itproduces net cash flow (i.e., R-E) of $30,000/yr. Theterminal value is zero. For 6 year period.The effective income tax rate is 40%. It is depreciated usingthe GDS on the 5 yr schedule. Find the PW using an aftertax MARR of 10%.

To find the present worth of above asset characteristics we formulate the cash flow . GDS…

100,0 6) Suppose yo produces net cash flow (i.e., R-E) of $30,000/yr. The terminal value is zero. For 6 year period. asis The effective income tax rate is 40%. It is depreciated using the GDS on the 5 yr schedule. Find the PW using an after

100,0 6) Suppose yo produces net cash flow (i.e., R-E) of $30,000/yr. The terminal value is zero. For 6 year period. asis The effective income tax rate is 40%. It is depreciated using the GDS on the 5 yr schedule. Find the PW using an after

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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Question

6) Suppose you have an asset with a basis of $100,000. It
produces net cash flow (i.e., R-E) of $30,000/yr. The
terminal value is zero. For 6 year period.
The effective income tax rate is 40%. It is depreciated using
the GDS on the 5 yr schedule. Find the PW using an after
tax MARR of 10%.

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