# Melinda invests $350,000 in a City of Heflin bond that pays 6.4 percent interest. Alternatively,... ###### Question: Melinda invests$350,000 in a City of Heflin bond that pays 6.4 percent interest. Alternatively, Melinda could have invested the $350,000 in a bond recently issued by Surething Inc., that pays 8 percent interest and has risk and other nontax characteristics similar to the City of Heflin bond. Assume Melinda's marginal tax rate is 20 percent. (Leave no cells blank - be sure to enter "O" wherever required. Round your after-tax rate of return to one decimal place.) Required: a. What is her after-tax rate of return for the City of Heflin bond? b. How much explicit tax does Melinda pay on the City of Heflin bond? c. How much implicit tax does she pay on the City of Heflin bond? d. How much explicit tax would she have paid on the Surething Inc. bond? e. What is her after-tax rate of return on the Surething Inc. bond? Hugh has the choice between investing in a City of Heflin bond at 7.6 percent or investing in a Surething Inc. bond at 10.6 percent. Assuming that both bonds have the same nontax characteristics and that Hugh has a 40 percent marginal tax rate, in which bond should he invest? Hugh should invest in the Fergie has the choice between investing in a State of New York bond at 6.9 percent and a Surething Inc. bond at 10.8 percent. Assuming that both bonds have the same nontax characteristics and that Fergie has a 30 percent marginal tax rate, what interest rate does the state of New York bond need to offer to make Fergie indifferent between investing in the two bonds? (Do not round intermediate calculations. Round your answer to 2 decimal places.) Interest rate ## Answers #### Similar Solved Questions 1 answer ##### 12. Fill in the blank: Miotic muscarine agonists are agents that constrict the urio e irid... 12. Fill in the blank: Miotic muscarine agonists are agents that constrict the urio e irid homone und is imperam or the growth and function of the thyroid gland. 14. True or False: Mineralocorticoids are a group of hormones secreted from the adrenal cortex. 15. Fill in the blank: Women must avoid sm... 1 answer ##### Project L requires an initial outlay at t = 0 of$68,310, its expected cash inflows...
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Andover Stores uses the average cost retail method to estimate its ending inventory. Information as of June 30, 2021, is as follows: 16 Beginning inventory Net purchases Net sales Cost $40,000 240,000 Retail$ 77,888 423,000 395, eee Required: Use the retail method to estimate the June 30, 2021, inv...