Multiple Choice
Curtis invests $250,000 in a city of Athens bond that pays 7% interest. Alternatively, Curtis 8c3o) uld have invested the $250,000 in a bond recently issued by Initech, Inc. that pays 9% interest with similar risk as the city of Athens bond. Assume that Curtis' marginal tax rate is 28%.What is Curtis' after-tax rate of return on the city of Athens bond?
A) 7.00%
B) 1.96%
C) 2.52%
D) 9.00%
E) None of the choices are correct.
Correct Answer:
Verified
Correct Answer:
Verified
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