A firm must decide between two silicon layer chip designs from Intel. Their effective income tax rate is

3939?%,

and MACRS depreciation is used. If the desired? after-tax return on investment is

99?%

per? year, which design should be? chosen?

PLEASE CALCULATE AW for B as well. Thanks

Problem 7-42 (algorithmic) Question Help A firm must decide between two silicon layer chip designs from Intel. Their effective income tax rate is 39%, and MACRS depreciation is used. lf he desired after-tax return on investment is 9% per year, which design should be chosen? Design A Design B Capital investmen $1,130,000 $1,830,000 $1,050,000 $1,190,000 MV at end of useful life Annual revenues less expenses $260,000 $350,000 MACRS property class 5 years 5 years Useful life 7 years 6 years Click the icon to view the GDS Recovery Rates (A) for the 5-year property class. More Info E Click the icon to view the interest and annuity table for discrete compounding when the MARR is 9% per year. Calculate the AW value for the Design A. GDS Recovery Rates (rk) AWA (9%) s Round to the nearest hundreds Year 5-year Property Class 0.2000 0.3200 0.1920 0.11 0.1152 Enter your answer in the answer box and then click Check Answer. 0.0576 parts Clear All remaining Print Done