If Rachel has a 40% tax rate and a 10% after-tax rate of return, a $100,000 tax

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Question:

If Rachel has a 40% tax rate and a 10% after-tax rate of return, a $100,000 tax deduction in one year will save how much tax in today's dollars (rounded)?

A. $100,000

B. $40,000

C. $37,040

D. $36,360

E. None of the above

Related Book For answer-question

Foundations of Financial Management

ISBN: 978-1259024979

10th Canadian edition

Authors: Stanley Block, Geoffrey Hirt, Bartley Danielsen, Doug Short, Michael Perretta

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Posted Date: Jun 09, 2022 08:02 AM

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If Rachel has a 40% tax rate and a 10% after-tax rate of return, a $100,000 tax

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Foundations of Financial Management

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