Homework Answers
| After Tax rate of return = Interest Rate x (1-marginal tax rate) |
| After Tax rate of return = 7.75% x (1-.24) |
| After Tax rate of return = 5.89% |
| Correct option is 5.89% |
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Curtis invests $450,000 in a city of Athens bond that pays 6.50 percent interest. Alternatively, Curtis...
Curtis invests $650,000 in a city of Athens bond that pays 8.75 percent interest. Alternatively, Curtis...
Curtis invests $650,000 in a city of Athens bond that pays 8.75 percent interest. Alternatively, Curtis could have invested the $650,000 in a bond recently issued by Initech, Inc. that pays 10 percent interest with similar risk as the city of Athens bond. Assume that Curtis's marginal tax rate is 24 percent. What is Curtis's after-tax rate of return on the city of Athens bond? Multiple Choice 7.07 percent O O ) 8.59 percent 8.75 percent O Ο 7.07 percent...
Curtis invests $625,000 in a city of Athens bond that pays 8.5 percent interest. Alternatively, Curtis...
Curtis invests $625,000 in a city of Athens bond that pays 8.5 percent interest. Alternatively, Curtis could have invested the $625,000 in a bond recently issued by Initech, Inc. that pays 9.5 percent interest with similar risk as the city of Athens bond. Assume that Curtis's marginal tax rate is 24 percent. What is Curtis's after-tax rate of return on the city of Athens bond? 0:52:18 Multiple Choice O o C) 8.50 percent 6.82 percent O 10.50 percent 20 !...
Curtis invests $825,000 in a city of Athens bond that pays 10.00 percent interest. Alternatively, Curtis...
Curtis invests $825,000 in a city of Athens bond that pays 10.00 percent interest. Alternatively, Curtis could have invested the $825,000 in a bond recently issued by Initech, Inc. that pays 13.00 percent interest with similar risk as the city of Athens bond. Assume that Curtis's marginal tax rate is 24 percent. How much implicit tax would Curtis pay on the city of Athens bond? Multiple Choice $82,500.0 $9,488 $9,388 Multiple Choice $82,500.0 $9,488 $9,388 $24,750.0 None of the choices...
Curtis invests $675,000 in a city of Athens bond that pays 9 percent interest. Alternatively, Curtis...
Curtis invests $675,000 in a city of Athens bond that pays 9 percent interest. Alternatively, Curtis could have invested the $675,000 in a bond recently issued by Initech, Inc. that pays 10.5 percent interest with similar risk as the city of Athens bond. Assume that Curtis's marginal tax rate is 24 percent. What is Curtis's after-tax rate of return on the city of Athens bond?
Curtis invests $300,000 in a city of Athens bond that pays 5 percent interest. Alternatively, Curtis...
Curtis invests $300,000 in a city of Athens bond that pays 5 percent interest. Alternatively, Curtis could have invested the $300,000 in a bond recently issued by Initech, Inc. that pays 7 percent interest with similar risk as the city of Athens bond. Assume that Curtis's marginal tax rate is 24 percent. What is Curtis's after-tax rate of return on the city of Athens bond? 4.84 percent 5.00 percent None of the choices are correct 3.32 percent 7.00 percent
Curtis invests $475,000 in a city of Athens bond that pays 6.75 percent interest. Alternatively, Curtis...
Curtis invests $475,000 in a city of Athens bond that pays 6.75 percent interest. Alternatively, Curtis could have invested the $475,000 in a bond recently issued by Initech, Inc. that pays 8.25 percent interest with similar risk as the city of Athens bond. Assume that Curtis's marginal tax rate is 24 percent. If Curtis invested in the Initech, Inc. bonds, what would be his after-tax rate of return from this investment? 6.75 percent 6.27 percent None of the choices are...
Curtis invests $250,000 in a city of Athens bond that pays 7% interest. Alternatively, Curtis could...
Curtis invests $250,000 in a city of Athens bond that pays 7% interest. Alternatively, Curtis could have invested the $250,000 in a bond recently issued by Initech, Inc. that pays 9% interest with similar risk as the city of Athens bond. Assume that Curtis's marginal tax rate is 28%. What is Curtis's after-tax rate of return on the city of Athens bond?
1. Curtis invests $825,000 in a city of Athens bond that pays 10.25 percent interest. Alternatively,...
1. Curtis invests $825,000 in a city of Athens bond that pays 10.25 percent interest. Alternatively, Curtis could have invested the $825,000 in a bond recently issued by Initech, Inc. that pays 13.00 percent interest with similar risk as the city of Athens bond. Assume that Curtis's marginal tax rate is 24 percent. How much explicit tax would Curtis incur on interest earned on the Initech, Inc. bond? Multiple Choice $81,910 $25,740 $20,295 $63,567.5 None of the choices are correct...
Curtis invests $250,000 in a city of Athens bond that pays 7% interest. Alternatively, Curtis could...
Curtis invests $250,000 in a city of Athens bond that pays 7% interest. Alternatively, Curtis could have invested the $250,000 in a bond recently issued by Initech, Inc. that pays 9% interest with similar risk as the city of Athens bond. Assume that Curtis's marginal tax rate is 28%. How much implicit tax would Curtis pay on the city of Athens bond? A. 17,500 B. 1400 c. 1300 d. 5000 e. none of these is correct
TB MC Qu. 01-85 Curtis invests... Curtis invests $700,000 in a city of Athens bond that...
TB MC Qu. 01-85 Curtis invests... Curtis invests $700,000 in a city of Athens bond that pays 9.25 percent interest. Alternatively, Curtis could have invested the $700,000 in a bond recently issued by Initech, Inc. that pays 11.00 percent interest with similar risk as the city of Athens bond. Assume that Curtis's marginal tax rate is 24 percent. points If Curtis invested in the Initech, Inc. bonds, what would be his after-tax rate of return from this investment? Multiple Choice...
Curtis invests $650,000 in a city of Athens bond that pays 8.75 percent interest. Alternatively, Curtis could have invested the $650,000 in a bond recently issued by Initech, Inc. that pays 10 percent interest with similar risk as the city of Athens bond. Assume that Curtis's marginal tax rate is 24 percent. What is Curtis's after-tax rate of return on the city of Athens bond? Multiple Choice 7.07 percent O O ) 8.59 percent 8.75 percent O Ο 7.07 percent...
Curtis invests $625,000 in a city of Athens bond that pays 8.5 percent interest. Alternatively, Curtis could have invested the $625,000 in a bond recently issued by Initech, Inc. that pays 9.5 percent interest with similar risk as the city of Athens bond. Assume that Curtis's marginal tax rate is 24 percent. What is Curtis's after-tax rate of return on the city of Athens bond? 0:52:18 Multiple Choice O o C) 8.50 percent 6.82 percent O 10.50 percent 20 !...
Curtis invests $825,000 in a city of Athens bond that pays 10.00 percent interest. Alternatively, Curtis could have invested the $825,000 in a bond recently issued by Initech, Inc. that pays 13.00 percent interest with similar risk as the city of Athens bond. Assume that Curtis's marginal tax rate is 24 percent. How much implicit tax would Curtis pay on the city of Athens bond? Multiple Choice $82,500.0 $9,488 $9,388 Multiple Choice $82,500.0 $9,488 $9,388 $24,750.0 None of the choices...
TB MC Qu. 01-85 Curtis invests... Curtis invests $700,000 in a city of Athens bond that pays 9.25 percent interest. Alternatively, Curtis could have invested the $700,000 in a bond recently issued by Initech, Inc. that pays 11.00 percent interest with similar risk as the city of Athens bond. Assume that Curtis's marginal tax rate is 24 percent. points If Curtis invested in the Initech, Inc. bonds, what would be his after-tax rate of return from this investment? Multiple Choice...
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