finance

posted by .

Your best taxable investment opportunity has an EAR of 4%. Your best tax-free investment opportunity has an EAR of 3%. If your tax rate is 30%, which opportunity provides the higher after-tax interest rate?

Respond to this Question

First Name
School Subject
Your Answer

Similar Questions

  1. Macroeconomics - Investment Tax Credit

    Assume that some large foreign countries decide to subsidize investment by instituting an investment tax credit. Then the home country's real exchange rate will fall and its net exports will rise. I completely don't understand the …
  2. Finance

    Your best taxable investment opportunity has an EAR of 4%. You best tax free investment opportunity has an EAR of 3%. If your tax rate is 30%, which opportunity provides the higher after tax interest rate?
  3. Corporate Finance

    Your best taxable investment opportunity has an EAR of 4%. You best tax-free investment opportunity has and EAR of 3%. If your tax rate is 30%, which opportunity provides the higher after-tax interest rate?
  4. Finance

    John has a chocie to make between two investment opportunities. investment 1, would bear a interest of 12.5% over a period of 5 years but is taxable. investment 2 would bear an interest of 8% over the same period but is tax exempt. …
  5. Finance

    Calculate die after-tax cost of debt under each of the following conditions: a. Interest rate of 13%, tax rate of 0% b. Interest rate of 13%, tax rate of 20% c. Interest rate of 13%, tax rate of 35%
  6. finance

    4. a. Someone in the 36 percent tax bracket can earn 9 percent annually on her investments in a tax-exempt IRA account. What will be the value of a one-time $10,000 investment in 5 years?
  7. AP Macroeconomics

    3. You buy a certificate of deposit (CD) that pays a nominal rate of 12% annually. You have a tax rate of 25%, so if the interest on this CD is taxable (which it may not be) your after-tax nominal rate is (1 ñ 25%) • 12% = 9%. Since …
  8. Finance/Economics

    You can invest your money in a taxable corporate bond paying 10% interest or a tax-free municipal bond paying 7% interest. Which would pay the higher after tax interest if you are in the 28% tax bracket?
  9. Taxtation

    Another client, Ms. Dunham, has asked you to help her understand how her tax is computed. You need to provide Ms. Dunham with the following: An example of how to calculate the tax liability using the tax rate table and the tax rate …
  10. Personal Finance

    Would you prefer a fully taxable investment earning 13.8 percent or a tax-exempt investment earning 10 percent?

More Similar Questions