Solution-What interest rate would a corporate bond have to

What interest rate would a corporate bond have to offer

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Problem 1: Assume that John's marginal tax rate is 37 percent. If a city of Austin bond pays 9.60 percent interest, what interest rate would a corporate bond have to offer for John to be indifferent between the two bonds?

A. 59.20%
B. 15.24%
C. 9.60%
D. 6.05%
E. None

Reference no: EM132787410

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What interest rate would a corporate bond have to offer

Reference no: EM132787410

Reference no: EM132787410

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