What is the present value of the depreciation tax savings

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Reference no: EM131346156

A machine costs $4 million, has a three-year useful life, and has zero salvage value. Assume a discount rate of 14% and a 40% tax rate. Assuming the machine is depreciated on a straight-line basis, what is the present value of the depreciation tax savings?

Reference no: EM131346156

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