What is the tax-free equivalent municipal interest rate

Assignment Help Operation Management

Reference no: EM131027319

Suppose that the interest rate on a taxable corporate bond is 9% and that the marginal tax is 25%. Suppose a tax-free municipal bond with a rate of 6.45% were available.

What is the tax-free equivalent municipal interest rate to this corporate bond?--------------%

Note Equi. Tax-free rate = corp. interest rate*(1 - tax rate)

Which security would you invest in, corporate bond or tax-free muni. bond?-------------bond

Reference no: EM131027319

Questions Cloud

Determined to clean up the downtown area : Officers Jones and Henderson are well-respected police officers in the Woodlawn community. They have been recognized, both within the police department and by the community, for their outstanding service. Determined to “clean up” the downtown area, t..

The iron triangle of health care debate : The Iron Triangle of Health Care Debate: consider how cost, access, and quality issues affect the U.S. health care system. Consider how these issues compare to other countries on an international level. determine whether you think the biggest issue f..

Federal circuit court of appeals for the ninth circuit : While driving his car in virginia, carpe diem, a resident of north carolina , struck butt, a resident of alaska. As a result of the accident, butt suffered more than $80,000 in midical expenses. butt would like to know if her personally serves the pr..

Market for the product or service really does exist : How can an entrepreneur seeking funds to launch a business convince potential lenders and investors that a market for the product or service really does exist?

What is the tax-free equivalent municipal interest rate : Suppose that the interest rate on a taxable corporate bond is 9% and that the marginal tax is 25%. Suppose a tax-free municipal bond with a rate of 6.45% were available. What is the tax-free equivalent municipal interest rate to this corporate bond? ..

Fills the weasel shaped containers with the cleaning fluid : You are a new employee at a household cleaner producer. Their new product, that is slated to compete with SC Johnson’s Toilet Duck bowl cleaner, is named Toilet Weasel. You are in charge of the machine that fills the weasel shaped containers with the..

Examine the uncertainty regarding the success : Your boss has asked you to work up a simulation model to examine the uncertainty regarding the success or failure of five different investment projects. He provides probabilities for the success of each project individually: p1=0.50, p2=0.35, p3=0.65..

Technologys that have the greatest benefits to taxpayers : Simply put, politicians need to spend tax dollars on technology's that have the greatest benefits to taxpayers. Flying to the moon, for example, may not necessarily make taxpayer's lives any easier, but it does offer a rise in morale and a boost in t..

Description of your proposed program-proposed pilot study : For this Assignment, in 5–7 pages design a program evaluation to address community needs for your Project initiative proposal. In your Assignment, be sure to include the following items: Description of your proposed program. Description of your propo..

User Account

All Pages