If Dennis requires $3,000 for an emergency expense and his MTR is 27%, how much must he withdraw from his RRSP?

To determine how much Dennis must withdraw from his RRSP to cover an emergency expense of $3,000, it's important to account for the tax implications of the withdrawal. Since the money withdrawn from an RRSP is subject to income tax at Dennis's marginal tax rate (MTR), the amount he actually receives will be less than what he withdraws.

Given Dennis has an MTR of 27%, we can find the amount he needs to withdraw using the formula:

Amount Required = Withdrawal Amount × (1 - MTR)

Rearranging this gives us:

Withdrawal Amount = Amount Required / (1 - MTR)

Substituting in Dennis's requirements:

Withdrawal Amount = $3,000 / (1 - 0.27)

Withdrawal Amount = $3,000 / 0.73

Withdrawal Amount ≈ $4,109.59

This value is approximately $4,110 when rounded. Therefore, in order to have $3,000 after taxes from the RRSP withdrawal, Dennis needs to withdraw $4,110.

This calculation clearly reflects the requirement to factor in the applicable tax rate when determining the necessary withdrawal amount, which is why the choice of $4,110 is correct.