Calculation of after tax return
Course:- Finance Basics
Reference No.:- EM1359102

Assignment Help >> Finance Basics

The Omega Corporation has some excess cash that it would like to invest in marketable securities for a long-term hold. Its vice-president of finance is considering three investments (Omega Corporation is in a 35 percent tax bracket and the tax rate on dividends is 15 percent). Which one should she select based on aftertax return: (a) Treasury bonds at a 9 percent yield; (b) corporate bonds at a 12 percent yield; or (c) preferred stock at a 10 percent yield?

Ask Question & Get Answers from Experts
Browse some more (Finance Basics) Materials
The fund will disburse monthly for 12 years, and the desired cash balance at the end of 12 years is $1,000,000. What is the monthly payment that can be made from this fund?
You can have $8,500 per month for the next three years, or you can have $7,200 per month for the next three years, along with a $38,500 signing bonus today. Assume the inter
In a paper, critique a situation in either your current organization or a previous organization that required a great deal of change. Make sure, at a minimum, to address the
You have $500,000 available to invest. The risk-free rate, as well as your borrowing rate, is 8%. The return on the risky portfolio is 16%. The standard deviation on the ris
A member of your board has asked if you have considered competitive bids for the distribution of your securities compared to a negotiated contract with a particular firm. Wh
XYZ pays no dividends and sells for $50.  There is a one-year call to buy 100 shares at $50 selling for $4.00.  If interest rates are 6%, what should a one-year put sell for?
Suppose you purchased one of Great White Shark Repellant Co.'s 7 percent coupon bonds one year ago for $870. These bonds make annual payments and mature 11 years from now.
Suppose a bank needs to borrow (not lend) $20 million for 3 months starting in December 2016. If the bank wants to lock in the borrowing interest rate now, what should it do