What is the depreciation tax shield for this project

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Reference no: EM132041086

Your firm needs a machine which costs $140,000, and requires $35,000 in maintenance for each year of its 10 year life. After 5 years, this machine will be replaced. The machine falls into the MACRS 10-year class life category. Assume a tax rate of 40% and a discount rate of 13%. What is the depreciation tax shield for this project in year 10?

Reference no: EM132041086

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