What question did this study set out to answer?

This study examines the impact of quarterly discounting on capital recovery options following TEFRA.

Capital Recovery Options: A Response and an Note on Changes Resulting from the Tax Equity and Fiscal Responsibility act of 1982 (TEFRA).

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The study demonstrates quarterly discounting improves capital recovery modeling, indicating more accurate taxpayer options.

This study examines the impact of quarterly discounting on capital recovery options following TEFRA.
Compared quarterly discounting of capital recovery functions to annual compounding.
Analyzed taxpayer options under the Accelerated Cost Recovery System.
Evaluated the theoretical merit of quarterly discounting in tax benefit calculations.
Quarterly discounting provides a more accurate representation of capital recovery flows compared to annual discounting.
The quarterly pattern of tax benefits aligns better with actual cash flows.
Indifference discount rates do not gain significant practical utility from the quarterly approach.

William F. Jordan (1983) studied this question.

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