If Rudy Has a 25 Percent Tax Rate and a 6

Multiple Choice

If Rudy has a 25 percent tax rate and a 6 percent after-tax rate of return, a $30,000 tax deduction in four years will save how much tax in today's dollars? Use Exhibit 3.1. (Round discount factor(s) to three decimal places.)

A) $30,000
B) $7,500
C) $23,760
D) $5,940
E) None of the choices are correct.