Answer:
The answer is A
Explanation:
Good luck on your assignment
Answer:
The municipal bond will give the client more profit after taxes because it has a higher equivalent yield (8.06%) compared to that of the corporate bond (6.55%)
Explanation:
Here, we are to compare a municipal bond to a corporate bond and determine which of the two will give the client more profit after taxes.
The first thing to calculate here is the equivalent taxable yield of the municipal yield.
Mathematically, we employ a mathematical approach approach here;
Equivalent taxable yield = Municipal yield/(1-tax rate)
From the question, we can identify that the tax rate is 28%
28% = 28/100 = 0.28
The municipal yield = 4.8%
Inputing these into the equation;
Equivalent taxable yield = 5.8/(1-0.28) = 5.8/0.72 = 8.06% approximately
Now comparing this value to the value of the corporate bond, we can see that the municipal bond offers a better profit after tax since it has a higher equivalent yield
<u>Answer:</u>Penetration pricing is suitable for products with Long anticipated lifecycle
<u>Explanation:</u>
Penetration pricing is done at the introductory life cycle of the product. Penetration pricing is suitable only if the product is expected to have a long product lifecycle. When the price of the product is set at lower rates then it would result in high volumes of sales.
This pricing is suitable for attaining economies of scale. This is useful to launch new product in the market. This pricing prevails in the market for a short period to gain the market share.
