For a tax-paying firm, an increase in ________ will cause the cash flow from assets to increase.

Name: For a tax-paying firm, an increase in ________ will cause the cash flow from assets to increase.
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Question

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An increase in depreciation reduces taxable income, which in turn reduces taxes paid by the firm. This increases the cash flow from assets because less cash is used to pay taxes, making more cash available for the firm's operations or investments.

For a Tax-Paying Firm, an Increase in ________ Will Cause