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Suppose a firm's tax rate is 20%. a. What effect would a $10.44...

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Question

Finance

Suppose a firm's tax rate is 20%.
a. What effect would a $10.44 million operating expense have on this year's earnings? What effect would it have on next year's earnings?
b. What effect would a $10.60 million capital expense have on this year's earnings if the capital is depreciated at a rate of $ 2.12 million per year for five years? What effect would it have on next year's earnings?
Question content area bottom
Part 1
a. What effect would a $10.44 million operating expense have on this year's earnings?
Earnings would increase(decline) by $
enter your response here million.

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