A Firm Is Considering Investing in a New Machine That

question 28

Multiple Choice

A firm is considering investing in a new machine that will cost $600,000 and will be be under asset class 43 with a CCA rate of 30%.If the firm's marginal tax rate is 39%,what is the CCA tax shield in the first year?

• A)$120,000
• B)$35,100
• C)$300,000
• D)$234,000
• E)$90,000

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Definitions:

Units of Quiche

The quantifiable amount of quiche, either in pieces or volume, considered in various contexts such as cooking or consumption.

Pure Exchange Economy

An economic model where individuals trade existing goods without the production of new goods, focusing on the redistribution of resources.

Utility Function

Represents a consumer's preferences by assigning a utility value to each possible choice, indicating the level of satisfaction or happiness derived from those choices.

Edgeworth Box

A diagram used in microeconomics to show the efficient distribution of resources between two individuals or the allocation of two goods in an economy.