Which bond would someone in a 35% tax bracket choose to buy: a municipal bond with an interest rate of 7% or a corporate bond with an interest rate of 10%?
What will be an ideal response?
The corporate bond returns 6.5% after taxes (0.65 × 10%). Thus, the investor is likely to choose the municipal bond since it offers a higher after-tax return.
Economics
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How many British pounds would it cost to buy a pair of American designer jeans costing $45 if the exchange rate is 2.00 dollars per British pound?
A) 22.5 British pounds B) 32.5 British pounds C) 12.5 British pounds D) 40 British pounds E) 30 British pounds
Economics
There is an inverse relationship between the present value of a future amount and the interest rate used for discounting
a. True b. False
Economics