Question
A bank is considering two securities: a 30-year Treasury bond yielding 10 percent and a 30-year municipal bond yielding 6 percent. a. If the banks
| A bank is considering two securities: a 30-year Treasury bond yielding 10 percent and a 30-year municipal bond yielding 6 percent. |
| a. | If the banks tax rate is 20 percent, calculate the Treasury bond's after-tax yield. (Round your answer to 1 decimal place. (e.g., 32.1)) |
| After-tax yield | % |
| b. | Which bond offers the higher after-tax yield? | ||||
|
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Emerging Markets And The Global Economy A Handbook
Authors: Mohammed El Hedi Arouri, Sabri Boubaker, Duc Khuong Nguyen
1st Edition
0124115497, 978-0124115491
