Calculate the Tax-Adjusted User Cost of Capital of a Machine

question 4

Multiple Choice

Calculate the tax-adjusted user cost of capital of a machine that costs $10,000 and depreciates at a rate of 10%,when the real interest rate is 3% and the tax rate on revenue is 5%.

• A)$1238
• B)$1300
• C)$1368
• D)$1800

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Definitions:

Landrum-Griffin Act

A 1959 U.S. law aimed at protecting union members from corrupt practices of their own unions by establishing certain democratic procedures within unions and regulating union affairs.

Political Lobbying

The act of attempting to influence decisions made by officials in the government, often by special interest groups.

State Laws

Legal regulations established and enforced by individual states within a country.

Collective Bargaining Rights

The legal right granted to employees to negotiate terms and conditions of employment through chosen representatives with their employer.