Matty's Place Is Considering the Installation of a New Computer

question 134

Multiple Choice

Matty's Place is considering the installation of a new computer system that will cut annual operating costs by $11,001. The system will cost $48,000 to purchase and install. This system will belong in a
40% CCA class. What is the amount of the increase in earnings before interest and taxes in the first
Year for this project?

• A) -$9,600
• B) $1,000
• C) $1,400
• D) $11,000
• E) $20,600

---

Definitions:

Debtor in Default

A debtor who has failed to fulfill their payment obligations under the terms of a loan or credit agreement.

Lender

An individual, institution, or entity that provides funds to another with the expectation that the funds will be repaid, often with interest.

Mortgage Owes

Refers to the outstanding balance or the amount still owed by a borrower on their mortgage loan.

Open Mortgage

A type of mortgage that can be paid off, in full or in part, at any time without penalty, offering flexibility in repayment.