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Assume you are in the 42.5 percent personal tax bracket. You are considering investing $50,000 in for profit Universal Health Services (UHS) bonds that carry

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Assume you are in the 42.5 percent personal tax bracket. You are considering investing $50,000 in for profit Universal Health Services (UHS) bonds that carry an 11.25 percent interest rate. a) How much interest would you receive net of the tax on the investment? 6 b) What is the after tax total amount of your investment? c) Now, consider that Not for Profit Kaiser Permanante, one of the leading California Healthcare systems, has issued tax-exempt bonds that have an interest 7 rate of 7 percent to finance a new Women's and Children's Pavillion. a With all else the same, should you buy $50,000 of the taxable UHS bonds at 11.25% interest, or 50,000 of Not for Profit Kaiser Permanante bonds? 9 d) Based on your answer to C above, please find the point interest rate) of indifference

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