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question 3

Multiple Choice

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XYZ Bank has DA = 2.4 years and DL = 0.9 years. The bank has total equity of $82 million and total assets of $850 million. Currently, interest rates are at 6%.
-If interest rates increase 100 basis points the predicted dollar change in equity value will equal

• A) $10,171,698
• B) -$10,171,698
• C) $12,724,528
• D) -$12,724,528
• E) $4,928,756

Understand the considerations for selecting a depreciation method based on asset usage and financial reporting goals.

Identify the tax considerations and regulations related to depreciation, including MACRS guidelines.

Calculate depreciation expenses using MACRS for different classes of assets.

Understand the conceptual and practical differences between depreciation methods and their application in various scenarios.