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hichkok12 [17]
3 years ago
9

Suppose that your marginal federal income tax rate is 30%, the sum of your marginal state and local tax rates is 5%, and the yie

ld on thirty-year U.S. Treasury bonds is 10%. You would be indifferent between buying a thirty-year Treasury bond and buying a thirty-year municipal bond issued within your state (ignoring differences in liquidity, risk, and costs of information) if the municipal bond has a yield ofA) 6.5%.
B) 7.0%.
C) 9.5%.
D) 10.0%.
Business
1 answer:
snow_tiger [21]3 years ago
3 0

Answer:

Option (B) is correct.

Explanation:

Given that,

Marginal federal income tax rate = 30%

Sum of your marginal state and local tax rates = 5%

Yield on thirty-year U.S. Treasury bonds = 10%

Municipal bond has a yield:

= U.S Treasury bonds × (1 - tax)

= 10% × (1 - 30%)

= (10 ÷ 100) × [1 - (30 ÷ 100)]

= (10 ÷ 100) × (70 ÷ 100 )

= (1 ÷ 10) × (7 ÷ 10 )

= (7 ÷ 100)

= 7%

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In accounting, a well-known ledger is used to fill all of an agency's transactions. inside a general ledger, transactional data is organized into assets, liabilities, sales, fees, and proprietor's equity. After each sub-ledger has been closed out, the accountant prepares the trial stability.

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4 0
1 year ago
1. A creditor's claim to the property of an individual or business is called
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Explanation:

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From the question, we are informed that the average cost of production for a bottle of water in the industry is 0.20 cents while its average price is 0.50 cents and that Water Inc. manufactures the same product for 0.10 cents while its average price is 0.40 cents.

The scenario shows that Water Inc has a competitive advantage in the industry. This is seen as the bottle of water is produced at a cheaper cost wen compared to its rivals.

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3 years ago
The city of Ann Arbor Michigan buys a police car manufactured in Germany. In the GDP accounts this transaction is included in a.
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