Answer:
before tax corportate bond equivalent: 11.15%
Explanation:
The municipal bond are tax-free making them more attractive than normal corporate bonds.
thus, the municipal bond rate should be compare with the after tax rate of a corporate bond:
before tax rate ( 1 - tax rate) = after tax rate
<u>For this case:</u>
the after tax rate is 7.25%
and the tax bracket is 35%
before taxes ( 1 - 0.35) = 0.0725
0.0725/.65 = 0,1115384 = <em>11.15%</em>
Answer:
The correct answer is the option B: Trust Indenture Act.
Explanation:
To begin with, the name of <em>"Trust Indenture Act of 1939"</em> or TIA refers to the an american law that specifically supplements the Securities Act of 1933 and whose purpose is basically put more safety in the cases where debt securities are distributed in the United States. It does it by requiring the appointment of a suitably and totally independent trustee who is qualified and has the only job to act for the benefit of the holders of those securities, that could be bonds, debentures or others. In addition, this act is managed obviously by the same agent as the other one, the Securities and Exchange Commission
Answer:
the bond's current yield.
Explanation:
When the price of the bond is equal to the initial price paid for the bond, the current yield rate of the bond is equal to the ROR of the bond. If there is the market price of the bond is the same as the initial issuance value of the bond the investors of the bond do not gain or lose anything from this bond from the change in price in the time period between the issuance of the bond and Purchasing date of the bond.
Current Yield = Annual Coupon payment / Market price of the bond
The bond yield will remain the same when the selling price of the bond and the issuance price of the bond remain the same. As the coupon payment is fixed every time.
Answer:
new
Explanation:
If the product is truly new, it is bought by novelty fans, snobs; This phase would be equivalent to that of the early childhood of the human being.
The product at this time is new and unknown, so it is necessary to spend some time in publicizing the product and gaining market acceptance. Sales start and grow very slowly. The benefits are non-existent in almost all this phase. The time when they start to occur usually coincides with the end of this stage.
That is why it is said that in addition to the FTC having a legal definition of the same, it is defined by the experienced consumer.
Answer:
36%
Explanation:
For the computation of the company's return on equity first we need to follow some steps which is shown below:-
Step 1
Earnings before tax = EBIT - Interest
= $452,000 - $152,000
= $300,000
Step 2
Earnings after interest and taxes = Earnings before tax - Tax
= $300,000 - ($300,000 × 40%)
= $300,000 - $120,000
= $180,000
Step 3
Asset turnover ratio = Total revenue ÷ Total assets
3.6 = $4,000,000 ÷ Total assets
Total assets = $1,111,111.11
Step 4
Equity ratio = 1 - Debt ratio
= 1 - 0.55
= 0.45
Step 5
Total Equity = Equity ratio × Total assets
= 0.45 × $1,111,111.11
= $500,000
and finally
Return on Equity = Net income ÷ Equity
= $180,000 ÷ $500,000
= 0.36
or
= 36%
