A Bakery Invests $40,000 in a Light Delivery Truck

question 50

Multiple Choice

A bakery invests $40,000 in a light delivery truck. This was depreciated using the five-year MACRS schedule shown above. If the company sold it immediately after the end of year 2 for $21,000, what would be the after-tax cash flow from the sale of this asset, given a tax rate of 40%?

• A) $11,520
• B) $9480
• C) $3792
• D) $17,208

Understand the relationship between net capital outflow and international financial transactions.

Grasp the components and calculation of a country's Gross Domestic Product (GDP) in an open economy.

Analyze the impact of trade balances on the economy, identifying trade surpluses and deficits.

Comprehend the concept of foreign direct investment and its implications for the home and host countries.

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Definitions:

Squalid Shacks

Poorly built and maintained small houses, often in a state of dirtiness and disrepair, associated with extreme poverty or lack of housing.

Legal Action

The process of using formal legal procedures and courts to resolve disputes, enforce laws, or seek justice.

Direct Action

A form of political or social activism that seeks immediate remedy to perceived injustices, often through methods outside of institutional channels.

NAACP

The National Association for the Advancement of Colored People is a civil rights organization in the United States, formed in 1909, aimed at advocating for the rights and improving the lives of African Americans.