easy · Investment Banking accounting
How does an increase in depreciation affect EBITDA (Earnings Before Interest, Taxes, Depreciation, and Amortization)?
- EBITDA increases by the amount of the tax shield
- EBITDA remains unchanged
- EBITDA decreases by the depreciation amount multiplied by (1 - Tax Rate)
- EBITDA decreases by the full amount of depreciation
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