What yield would you need to earn on a taxable bond to be

Assignment Help Macroeconomics
Reference no: EM13321253

A new-issue municipal bond rated Aaa by Moody"s Investors Service is priced to yield 8 percent. If you are in the 33 percent tax bracket, what yield would you need to earn on a taxable bond to be indifferent?

Reference no: EM13321253

Questions Cloud

How different is your answer from the actual price change : Calculate the duration for a $1,000, 4-year bond with a 4.5 percent annual coupon, currently selling at par. Use the bond"s duration to estimate the percentage change in the bond"s price for a decrease
Discuss how the nec3 form of contract provides stimulus : Discuss how the NEC3 form of contract provides stimulus to good management and compare and contrast this where possible with other forms of contract.
Has the bank set the 5-year rate correctly : A commercial bank made a 5-year term loan at 13 percent. The bank"s economics department forecasts that 1 and 3 years in the future the 2-year interest rate will be 12 percent and 14 percent, respectively
What is the max flowrate which will occur without cavitation : If the water temperature is 70 degrees C (vapor pressure of water at 70 degrees C is 31.2 kPa absolute), and the pressure in the pipeline is 275 kPa, what is the maximum flowrate which will occur without cavitation
What yield would you need to earn on a taxable bond to be : A new-issue municipal bond rated Aaa by Moody"s Investors Service is priced to yield 8 percent. If you are in the 33 percent tax bracket, what yield would you need to earn on a taxable bond to be indifferent?
Would a bond investor be most likely to exercise a put : Under which scenario, rising interest rates or falling interest rates, would a bond investor be most likely to exercise a put option on a bond? Explain.
The mcdonald''s strategy : The strategy and problem are used in the McDonald's strategy
Calculate the velocity in the constriction and the flowrate : Water flows through a 75 mm constriction in a horizontal 150 mm pipe. If the pressure in the 150 mm section is 345 kPa and that in the constriction 207 kPa, calculate the velocity in the constriction and the flowrate.
Determine the largest load p that can be applied : If each cable segment can support maximum tension of 75 lb, determine the largest load P that can be applied.

Reviews

Write a Review

Macroeconomics Questions & Answers

  Explain the marginal cost and average total cost curves

In the early 1990's, a study found that moderate daily consumption of red wine reduced the incidence of heart disease in labratory rats. As a result of national press coverage of the report, the demand for red wine increased dramatically. Assume t..

  Find out two articles that discuss the loca

Find out two articles that discuss the local, state, or federal taxation of a good. Describe the effects of taxation and price controls on the economy.

  What is the marginal and average tax rate for each family

Suppose that the tax rate on the first $10,000 income is 0; 10 percent on the next $20,000; 20 percent on the next $20,000; 30 percent on the next $30,000; and 40 percent on any income over $80,000.Family A has an income of $40,000 and Family B has..

  What is the value of the externality

If the apple grower wants to see 6,000 bees kept, what is the value of the externality? What would have to happen for the socially optimal amount of bees to be kept?

  Explanation of more or less steady rate of growth

Explain and discuss the mechanisms by which this has occurred, and contrast our experience with: a) the recent performance of many NICs (newly-industrializing-countries) in the last few decades

  Explain how does the concept of comparative advantage

Explain how does the Concept of Comparative Advantage actually "prove the advantages" of free trade to both countries involved in a transaction.

  Calculate equilibrium levels of real output nd interest rate

a). Derive the equation for the IS curve b)Find the equation for LM curve. c)express both IS and LM curves in terms of r, and graph both curves.Find their slopes. d) Calculate the equilibrium levels of real utput, interest rate, planned investment, a..

  Describing supply of money-commodity and flat money

What is the difference between the medium of exchange and the store of value? What is the difference between commodity money and fiat money?

  How does duration differ from maturity

What are the two different general interpretations of the concept of duration, and what is the technical definition of this term? How does duration differ from maturity?

  How network externalities affect firm operating strategies

Explain why the cost structure associated with many kinds of information goods and services might imply a market supplied by a small number of large firms.

  Formula to calculate the net benefits

Suppose the City of Klamath is considering plans to build a dam on the Klamath River. There are currently social benefits to the recreational fishermen who use the river to catch salmon.

  Aggregate demand-aggregate supply curves

Explain the impacts of an expansionary fiscal policy such as a tax cut on the levels GDP, Consumption, Investment, interest rate and unemployment and price.

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd