If a company spends $40 million to install new footwear-making equipment with capacity to produce 2 million pairs of athletic footwear at its Asia Pacific production facility, then its annual depreciation costs at that facility will rise by 

• 2.5% or $1,000,000. 
• 8% or $3,200,000. 
• 10% or $4,000,000. 
• 4% or $1,600,000. 
• 5% or $3,000,000.
•  

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