What is the minimum marginal tax rate the investor

Assignment Help Financial Management

Reference no: EM13731897

An investor is trying to decide between a muni paying 5.75 percent or an equivalent taxable corporate paying 8.25 percent. What is the minimum marginal tax rate the investor must have to consider buying the municipal bond?

A. 80.00 percent

B. 20.00 percent

C. 25.00 percent

D. 66.67 percent

E. 30.00 percent

Reference no: EM13731897

Questions Cloud

How much should he set aside today for the purchase : Stephen plans to purchase a car 5 years from now. The car will cost $55,339 at that time. Assume that Stephen can earn 5.16 percent (compounded monthly) on his money. How much should he set aside today for the purchase?

The fed funds rate is the rate : The Fed funds rate is the rate that

Appropriate measure to use than net present value : Despite shortcomings of the internal rate of return in some situations, why do most financial managers use IRR along with NPV when evaluating projects? Is there a situation in which IRR might be more appropriate measure to use than Net present value?

Estimate the incremental operating cash flows attributable : Wilber Corporation is considering replacing a machine. The replacement will cut operating expenses by $24,000 per year for each of the 5 years the machine is expected to last. Although the old machine has a zero book value, it has a remaining useful ..

What is the minimum marginal tax rate the investor : An investor is trying to decide between a muni paying 5.75 percent or an equivalent taxable corporate paying 8.25 percent. What is the minimum marginal tax rate the investor must have to consider buying the municipal bond?

The average annual growth rate of dividends for this firm : A firms dividends have grown over the last several years. 3 years ago the firm paid a dividend of $2. Yesterday it paid a dividend of $4. What was the average annual growth rate of dividends for this firm? Round the answer to two decimal places in pe..

Year-end the exchange rate should be approximately : The spot rate for the Argentine peso is $0.3600 per peso. Over the year, inflation in Argentina is 10 percent and U.S. inflation is 4 percent. If purchasing power parity holds, at year-end the exchange rate should be approximately ______________ doll..

Develop a research instrument that used to collect data : Describe the method of research to be applied and why it is most appropriate for the study. Describe the population, the sample, and how you intend to gather data to address the research problem.

What is the best way to communicate with employees : What is the best way to communicate with employees to gain their support when implementing a strategy. How may Six Sigma be used to value and support the implementation process

User Account

All Pages