3. Consider the eect that corporate prot taxes have on investing. Look back at Figure 15.4. Suppose that the r line is the rate of return a rm earns before taxes. If corporate prot taxes are imposed, the rm's after-tax returns will be lower (and the higher the tax rate, the lower the after-tax returns). If the rm's decisions about R&D spending are based on comparing after-tax returns with the interest-rate cost of funds, how will increased taxes on corporate prots affect R&D spending? How, if at all, does this effect modify your views on corporate prot taxes? Discuss. L015.3