Suppose a Machine That Costs $80,000 Has a Useful Life

question 44

Multiple Choice

Suppose a machine that costs $80,000 has a useful life of ten years.Also suppose that capital cost allowance (CCA) deduction on the machine is $8,000 in year 4.The tax rate is 40%.What would be the tax savings from the CCA tax shield in year 4?

• A) $4,800 outflow.
• B) $3,200 outflow.
• C) $3,200 inflow.
• D) $4,800 inflow.

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Definitions:

Product Information

Detailed data and specifications about a product, including its features, benefits, usage instructions, and manufacturing details.

Marketing Research

The process of gathering, analyzing, and interpreting information to help identify and solve marketing challenges.

Functional Magnetic Resonance Imaging (fMRI)

a neuroimaging procedure that measures brain activity by detecting changes associated with blood flow.

Extended Problem Solving

A consumer behavior in which individuals engage in considerable information search and evaluation of alternatives before making significant purchase decisions.