Carol wants to invest in a project that requires a $20,000 investment. She expects a before-tax return of $16,000 in years 1 through 3 from this investment. She uses a 6 percent discount rate for evaluation but is not sure if her marginal tax rate will be 12 percent or 24 percent. What difference does the marginal tax rate make in the after-tax net present value of this investment?

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The Answer of Carol wants to invest in a project that requires a $20,000 investment. She expects a before-tax return of $16,000 in years 1 through 3 from this investment. She uses a 6 percent discount rate for evaluation but is not sure if her marginal tax rate will be 12 percent or 24 percent. What difference does the marginal tax rate make in the after-tax net present value of this investment?

Carol Wants to Invest in a Project That Requires a $20,000