What is the effective corporate tax rate when the value of the tax credit for each dollar of investment is $0.25,the tax rate on earnings minus labor is 35%,and the present discounted value of a $1 investment is $0.50?

Question

Quizplus · Accepted Answer

The effective corporate tax rate is calculated as the statutory tax rate minus the value of the tax credit divided by the present value of the investment. Here, it is 35% - ($0.25 / $0.50) = -11.53%.

What Is the Effective Corporate Tax Rate When the Value