A tax-exempt municipal bond has a yield of 6.36%. What should be the yield (in %,...
A tax-exempt municipal bond has a yield of 6.36%. What should be the yield (in %, to the nearest 0.01%) on an otherwise similar corporate bond to make an investor with the 22% marginal tax rate indifferent between the two bonds? E.g., if your answer is 7.145%, record it as 7.15.
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A tax-exempt municipal bond has a yield of 6.36%. What should be
the yield (in %,...
A corporate bond has a yield of 3.91%. What should be the yield on a tax-exempt...
A corporate bond has a yield of 3.91%. What should be the yield on a tax-exempt municipal bond (in %, to the nearest 0.01%) to make an investor with the 33% marginal tax rate indifferent between the two bonds? E.g., if your answer is 3.237%, record it as 3.24.
A tax-exempt municipal bond has a yield to maturity of 4.99%. An investor, who has a...
A tax-exempt municipal bond has a yield to maturity of 4.99%. An investor, who has a marginal tax rate of 30.00%, would prefer and an otherwise identical taxable corporate bond if it had a yield to maturity of more than ____%.
An investor is indifferent between holding a corporate bond with a before-tax yield of 6.61% and...
An investor is indifferent between holding a corporate bond with a before-tax yield of 6.61% and a tax-exempt municipal bond with a yield of 4.51%. What is the marginal tax rate of the investor, in %, to the nearest 0.1%? E.g., if your answer is 27.13%, enter it as 27.1.
A municipal bond has yield to maturity of 5.08 percent. A comparable corporate bond has yield...
A municipal bond has yield to maturity of 5.08 percent. A comparable corporate bond has yield to maturity of 7.24 percent. Which of these two bonds should an investor with a marginal tax rate of 28 percent buy? A. The corporate bond because it offers a higher after-tax yield to maturity. B. The corporate bond because its stated yield to maturity of 7.24 percent is higher than the municipal bond's stated yield to maturity of 5.08 percent. CC. The municipal...
Municipal bonds are tax-exempt from the Federal income tax. Assume a new 10-year municipal bond has...
Municipal bonds are tax-exempt from the Federal income tax. Assume a new 10-year municipal bond has a 3%/year coupon rate. What would be the required coupon rate on a taxable bond for an investor to be indifferent in holding a taxable bond compared to the 3% tax-free bond? Assume the investor is in a 40% marginal income tax bracket. Both bonds have the same credit quality. 5.0% 1.8% 1.2% 7.5% 3.0%
A tax-exempt municipal bond with a coupon rate of 8.00% has a market price of 98.76%...
A tax-exempt municipal bond with a coupon rate of 8.00% has a market price of 98.76% of par. The bond matures in 8.00 years and pays semi-annually. Assume an investor has a 18.00% marginal tax rate. The investor would prefer otherwise identical taxable bond if it's yield to maturity was more than _____%
A tax-exempt municipal bond with a coupon rate of 4.00% has a market price of 98.77%...
A tax-exempt municipal bond with a coupon rate of 4.00% has a market price of 98.77% of par. The bond matures in 17.00 years and pays semi-annually. Assume an investor has a 16.00% marginal tax rate. The investor would prefer otherwise identical taxable bond if it's yield to maturity was more than _____%
1)- A municipal bond selling at par currently yields 7.5%. A corporate bond selling at par...
1)- A municipal bond selling at par currently yields 7.5%. A corporate bond selling at par currently yields 10%. At what marginal tax rate would an investor be indifferent between this two bonds? 2)- A corporate bond selling at par currently yields 7.5%. Amy's marginal tax rate is 20%. How much should a municipal bond selling at par yields so that Amy is indifferent between this two bonds? 3)- A municipal bond selling at par currently yields 6.5%. Bob's marginal...
3. A municipal bond with a face value of $1,000 is paying a coupon rate of...
3. A municipal bond with a face value of $1,000 is paying a coupon rate of 9%. If an investor's tax rate is 30%, what rate of return should a similar corporate bond pay to make the investor indifferent between the two bonds?
Personal After-Tax Yield Corporate bonds issued by Johnson Corporation currently yield 12%. Municipal bonds of equal...
Personal After-Tax Yield Corporate bonds issued by Johnson Corporation currently yield 12%. Municipal bonds of equal risk currently yield 6%. At what tax rate would an investor be indifferent between these two bonds? Round your answer to two decimal places. % Corporate After-Tax Yield The Shrieves Corporation has $15,000 that it plans to invest in marketable securities. It is choosing among AT&T bonds, which yield 9.25%, state of Florida muni bonds, which yield 6% (but are not taxable), and AT&T...
A municipal bond has yield to maturity of 5.08 percent. A comparable corporate bond has yield to maturity of 7.24 percent. Which of these two bonds should an investor with a marginal tax rate of 28 percent buy? A. The corporate bond because it offers a higher after-tax yield to maturity. B. The corporate bond because its stated yield to maturity of 7.24 percent is higher than the municipal bond's stated yield to maturity of 5.08 percent. CC. The municipal...
Municipal bonds are tax-exempt from the Federal income tax. Assume a new 10-year municipal bond has a 3%/year coupon rate. What would be the required coupon rate on a taxable bond for an investor to be indifferent in holding a taxable bond compared to the 3% tax-free bond? Assume the investor is in a 40% marginal income tax bracket. Both bonds have the same credit quality. 5.0% 1.8% 1.2% 7.5% 3.0%
3. A municipal bond with a face value of $1,000 is paying a coupon rate of 9%. If an investor's tax rate is 30%, what rate of return should a similar corporate bond pay to make the investor indifferent between the two bonds?
Personal After-Tax Yield Corporate bonds issued by Johnson Corporation currently yield 12%. Municipal bonds of equal risk currently yield 6%. At what tax rate would an investor be indifferent between these two bonds? Round your answer to two decimal places. % Corporate After-Tax Yield The Shrieves Corporation has $15,000 that it plans to invest in marketable securities. It is choosing among AT&T bonds, which yield 9.25%, state of Florida muni bonds, which yield 6% (but are not taxable), and AT&T...
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