1answer.
Ask question
Login Signup
Ask question
All categories
  • English
  • Mathematics
  • Social Studies
  • Business
  • History
  • Health
  • Geography
  • Biology
  • Physics
  • Chemistry
  • Computers and Technology
  • Arts
  • World Languages
  • Spanish
  • French
  • German
  • Advanced Placement (AP)
  • SAT
  • Medicine
  • Law
  • Engineering
alexgriva [62]
3 years ago
14

An investor in the 32% tax bracket is considering two investment options of equal risk: a corporate bond that yields 8.25% and a

municipal (muni) bond that yields 4.75%. Assuming the investor will select the bond with the highest yield, which bond should this investor choose
Business
1 answer:
Gala2k [10]3 years ago
7 0

Answer: Corporate bond

Explanation:

It should be noted that the municipal bond aren't taxable. Therefore, its yield will be 4.75%.

On the other hand, the After Tax Cost of the yield of the corporate bond will be:

= Yield × (1-Tax Rate)

= 8.25% × (1-35%)

= 8.25% × 65%

= 5.36%

Therefore, the Corporate Bond should be chosen since it has a higher yield.

You might be interested in
During which phase of the communication process is it most likely that the entire communication process may repeat? A: feedback
Alexandra [31]
The correct option is A.
Feedback refers to the receiver's response to the message he has received. The receiver may have to write the response down and send it to the sender who read it and interpret the message; thus repeating the whole process of communication again.
8 0
3 years ago
What are some certifications that would benefit my career in the financial industry, that I can obtain quickly?
katrin2010 [14]
A business degree !
3 0
3 years ago
Suppose LovetoRead sells 1 comma 600 hardcover books per day at an average price of $ 50. Assume that LovetoRead's cost for the
Oduvanchick [21]
First you have to turn left mom, NO MOM TURN LEFT, okay now do you see that hole in the ground, yea , ok good now jump down it and come get me , i got tied up, okay thank you, OKAY STOP SIRI, STOP TEXTING MY MOM ALREADY SIRI, SIRRIIIIIIIIIII
5 0
3 years ago
The developing country of alpha had a rule that none of its factories could be owned by companies from the developed country of
hjlf
<span>When the developing country alpha breaks the rule of factories not being owned by the companies of developed country beta would imply that alpha is in a vulnerable position in its trade. So this means this would be an example of decline in trade and investment barriers.</span>
4 0
3 years ago
Each language possesses a structure which must at some level influence the way its users view the world.
attashe74 [19]
The statement above is popularly referred to as Whorfian hypothesis. The hypothesis states that language directly affects the way people think about the world and the way they perceive it, thus it holds the idea that one's language determines one's conception of the world.
3 0
3 years ago
Other questions:
  • Ronda's debt to Skye is past due. Skye brings a legal action against Ronda to collect the debt. To ensure that a judgment in Sky
    8·1 answer
  • You are speaking to a group of consumers about ways to use food labels to choose healthy foods in the grocery store. during your
    10·1 answer
  • Singapore Airlines is recognized as an industry leader for exemplary customer service, and has continued to add new ways to serv
    9·1 answer
  • Lonergan Company occasionally uses its accounts receivable to obtain immediate cash. At the end of June 2021, the company had ac
    7·1 answer
  • Sunny Corporation began the year with cash of $ 141, 000 and land that cost $ 55, 000. During the year Sunny earned service reve
    14·1 answer
  • Dr. regan was hired by the siri company to assist them with retaining their employees without lowering profits and expectations.
    5·1 answer
  • Riverside Company issued long-term debt of 350 paid dividends of 20 and issued capital stock of 100. Cash flow from financing ac
    14·1 answer
  • Who was the first men in india​
    13·2 answers
  • Why is it that restaurants have been so slow in adopting analytics
    8·1 answer
  • Advertising a home for sale in a minority area exclusively in a paper aimed at that minority group would most likely be regarded
    14·1 answer
Add answer
Login
Not registered? Fast signup
Signup
Login Signup
Ask question!