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| Teaching Since: | May 2017 |
| Last Sign in: | 408 Weeks Ago |
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MCS,PHD
Argosy University/ Phoniex University/
Nov-2005 - Oct-2011
Professor
Phoniex University
Oct-2001 - Nov-2016
3. The major feature of the tax code that affects the user cost of capital in the case of owner-occupied housing in the United States is that nominal interest payments are tax-deductible. Thus the after-tax real interest rate relevant to home ownership is r – Ti, where r is the pretax real interest rate, i is the nominal interest rate, and τ is the marginal tax rate. In this case, how does an increase in inflation for a given r affect the user cost of capital and the desired capital stock?
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