What is the effective after-tax yield to an investor from a bond paying $70 per $1,000 annually, if the investor is in a 25% marginal tax bracket? Explain.
What will be an ideal response?
5.25%. The $70 is taxed at 25%; leaving the bondholder with $52.50; which when divided by the $1,000 provides an effective yield of 5.25%
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a. True b. False Indicate whether the statement is true or false
If everyone's utility function includes only conspicuous consumption goods:
A. the market will lead to higher social welfare than it otherwise would. B. the market will lead to lower social welfare than it otherwise would. C. we can say nothing about market and social welfare. D. the market will lead to the highest social welfare.
Which is considered a strength of monetary policy compared to fiscal policy?
What will be an ideal response?
Is innovation within existing firms important? Explain and give examples
What will be an ideal response?