Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

A taxpayer can invest ( $ 10,000 ) in a money market fund that yields an annual pre-tax rate of return of 8.0 or buy

image text in transcribed
A taxpayer can invest \\( \\$ 10,000 \\) in a money market fund that yields an annual pre-tax rate of return of \8.0 or buy an acre of land for \\( \\$ 1,000 \\) that appreciates at a \8.0 annual rate. The taxpayer plans to sell the land after 20 years and faces a \25 annual tax rate over the 20 years. What is the annualized after-tax return after-tax rate of return for the land? Please enter in percent to the nearest tenth of a percent and without the \"\\%\" sign, use \\( 4 / 5 \\) rounding \(0.1175=11.75, enter: 11.8\\( ) \\) A taxpayer can invest \\( \\$ 10,000 \\) in a money market fund that yields an annual pre-tax rate of return of \8.0 or buy an acre of land for \\( \\$ 1,000 \\) that appreciates at a \8.0 annual rate. The taxpayer plans to sell the land after 20 years and faces a \25 annual tax rate over the 20 years. What is the annualized after-tax return after-tax rate of return for the land? Please enter in percent to the nearest tenth of a percent and without the \"\\%\" sign, use \\( 4 / 5 \\) rounding \(0.1175=11.75, enter: 11.8\\( ) \\)

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image_2

Step: 3

blur-text-image_3

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Grow Your Small Business Profits How I Find A 100K In Any Business In 45 Minutes

Authors: Sharon Coleman

1st Edition

B0C9S9CCZJ, 979-8850917258

More Books

Students also viewed these Finance questions