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Nitella [24]
3 years ago
5

Suppose a foreign investor who holds tax-exempt Eurobonds paying 10.50% is considering investing in an equivalent-risk domestic

bond in a country with a 28% withholding tax on interest paid to foreigners. If 10.50% after-tax is the investor's required return, what before-tax rate would the domestic bond need to pay to provide the required after-tax return
Business
1 answer:
algol133 years ago
4 0

Options:

a. 14.58%  

b. 12.83%  

c. 15.46%  

d. 16.33%  

e. 16.92%

Answer:

Correct option is A.

14.58%

Explanation:

After-tax yield = pre-tax yield x (1- marginal rate)

and Taxable-equivalent yield = tax-exempt yield / (1- marginal tax rate)

Hence Taxable-equivalent yield =.105/(1-.28)  

=.105/.72=.14583333

=14.58 %

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Answer:

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If the borrower repays the loan after 4 ​years

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If the borrower repays the loan after 8 ​years

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The amount that will be due if the borrower repays the loan after 2 ​year is $319.21.

4 0
2 years ago
When correcting errors in a trial balance, the ruling method should be used a.when a proper entry has been made but posted to th
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Answer:

d.when an incorrect journal entry has been made, but not yet posted and when a proper entry has been made but posted to the wrong account or for the wrong amount

Explanation:

When correcting errors in a trial balance, the ruling method should be used "when an incorrect journal entry has been made, but not yet posted and when a proper entry has been made but posted to the wrong account or for the wrong amount."

In trial balancing, an error can be fixed or corrected by tracing the trial balance steps. First, make a comparison between the ledger balances and the amount posted to the trial balance then add both debit and credit table if the amount matches, otherwise use the transposition method.

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"You are reading a particular section of a bank’s annual report. This section provides the bank’s views about the impact of an u
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Answer:

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