LO.1, 2, 5 Harper is considering three alternative investments of $10,000. Assume that the taxpayer is in the 24% marginal tax bracket for ordinary income and 15% for qualifying capital gains in all tax years. The selected investment will be liquidated at the end of five years. The alternatives are: A taxable corporate bond yielding 5.333% before tax and the interest can be reinvested at 5.333% before tax. A Series EE bond that will have a maturity value of $12,200 (a 4% before-tax rate of return). Land that will increase in value. The gain on the land is classified and taxed as a long-term capital gain. The income from the bonds is taxed as ordinary income. How much must the land increase in value to yield a greater after-tax return than either of the bonds? For this analysis, ignore the effect of property taxes on the land. Use the future value tables in Appendix E as needed for your calculations and comparisons. Present your answers using spreadsheet software such as Microsoft Excel. Future Value of $1 N/R 1% 2% 3% 4% 5% 6% 7% 8% 9% 10% 11% 12% 1 1.0100 1.0200 1.0300 1.0400 1.0500 1.0600 1.0700 1.0800 1,0900 1.1000 1.1100 1.1200 2 1.0201 1.0404 1.0609 1.0816 1.1025 1.1236 1.1449 1.1664 1.1881 1.2100 1.2321 1.2544 3 1.0303 1.0612 1.0927 1.1249 1.1576 1.1910 1.2250 1.2597 1.2950 1.3310 1.3676 1.4049 4 1.0406 1.0824 5 1.0510 1.1041 6 1.0615 1.1262 7 1.0721 1.1487 8 1.0829 1.1717 9 1.0937 1.1951 1.1255 1.1699 1.2155 1.2625 1.3108 1.1593 1.2167 1.2763 1.3382 1.4026 1.1941 1.2653 1.3401 1.4185 1.5007 1.5869 1.6771 1.2299 1.3159 1.4071 1.5036 1.6058 1.7138 1.2668 1.3686 1.4775 1.8509 1.3048 1.4233 1.5513 1.3605 1.4116 1.4641 1.5181 1.5735 1.4693 1.5386 1.6105 1.6851 1.7623 1.7716 1.8704 1.9738 1.8280 1.9487 2.0762 2.2107 10 1.1046 1.2190 11 1.1157 1.2434 1.3439 1.3842 12 1.1268 1.2682 13 1.1381 1.4258 1.6010 1.2936 1.4685 1.6651 14 1.1495 1.3195 1.5126 1.7317 15 1.1610 1.3459 1.5580 1.8009 2.0789 16 1.1726 1.3728 1.6047 1.8730 2.1829 2.5404 17 1.1843 1.4002 1.6528 1.9479 2.2920 18 1.1961 1.4282 19 1.2081 1.4568 20 1.2202 1.4859 1.7024 2.0258 1.7535 2.1068 1.8061 2.1911 2.6928 2.4066 2.8543 2.5270 3.0256 2.6533 3.2071 1.4802 1.6289 1.7908 1.5395 1.7103 1.8983 2.1049 2.3316 1.7959 2.0122 2.2522 2.5182 1.8856 2.1329 2.4098 2.7196 1.9799 2.2609 2.5785 2.9372 2.3966 2.7590 3.1722 2.9522 3.4259 3.1588 3.7000 3.3799 3.9960 3.6165 4.3157 3.8697 4.6610 1.5938 1.7182 1.6895 1.8385 1.9672 1.9926 2.1436 2.3045 2.4760 1.9990 2.1719 2.3579 2.5580 2.7731 2.1589 2.3674 2.5937 2.8394 3.1058 4.5950 5.3109 5.0545 5.8951 5.5599 6.5436 2.5804 2.8531 2.8127 3.1384 3.4985 3.8960 3.0658 3.4523 3.8833 4.3635 3.3417 3.7975 4.3104 3.6425 4.1772 4.7846 3.9703 4.3276 4.7171 5.1417 6.1159 5.6044 6.7275 3.1518 3.4785 4.8871 5.4736 6.1304 6.8660 7.6900 7.2633 8.6128 8.0623 9.6463 Future Value of an Ordinary Annuity of $1 N/R 1% 2% 3% 4% 5% 6% 1 1.0000 1.0000 1.0000 1.0000 1.0000 2 2.0100 3 3.0301 4 5 5.1010 4.0604 4.1216 5.2040 6 7 7.2135 8 8.2857 9 10 11 12 8% 9% 1.0000 1.0000 1.0000 1.0000 1.0000 2.0200 2.0300 2.0400 2.0500 2.0600 2.0800 2.0900 2.1000 2.1100 2.1200 3.0604 3.0909 3.1216 3.1525 3.1836 3.2149 3.2464 3.2781 3.3421 3.3744 4.1836 4.2465 4.3101 4.3746 4.4399 4.5061 4.5731 4.7097 4.7793 5.3091 5.4163 5.5256 5.6371 5.7507 5.8666 5.9847 6.1051 6.2278 6.3528 6.1520 6.3081 6.4684 6.6330 6.8019 6.9753 7.1533 7.3359 7.5233 7.7156 7.9129 8.1152 7.4343 7.6625 7.8983 8.1420 8.3938 8.6540 8.9228 9.2004 9.4872 9.7833 10.0890 8.5830 8.8923 9.2142 9.5491 9.8975 10.2598 10.6366 11.0285 11.4359 11.8594 12.2997 9.3685 9.7546 10.1591 10.5828 11.0266 11.4913 11.9780 12.4876 13.0210 13.5795 14.1640 14.7757 10.4622 10.9497 11.4639 12.0061 12.5779 13.1808 13.8164 14.4866 15.1929 15.9374 16.7220 17.5487 11.5668 12.1687 12.8078 13.4864 14.2068 14.9716 15.7836 16.6455 17.5603 18.5312 19.5614 20.6546 12.6825 13.4121 14.1920 15.0258 15.9171 16.8699 17.8885 18.9771 20.1407 21.3843 22.7132 24.1331 13 13.8093 14.6803 15.6178 16.6268 17.7130 18.8821 20.1406 21.4953 22.9534 24.5227 26.2116 28.0291 14 14.9474 15.9739 17.0863 18.2919 19.5986 21.0151 22.5505 24.2149 26.0192 27.9750 30.0949 32.3926 15 16.0969 17.2934 18.5989 20.0236 21.5786 23.2760 25.1290 27.1521 29.3609 31.7725 34.4054 37.2797 16 17.2579 18.6393 20.1569 21.8245 23.6575 25.6725 27.8881 30.3243 33.0034 35.9497 39.1899 42.7533 17 18.4304 20.0121 21.7616 23.6975 25.8404 28.2129 30.8402 33.7502 36.9737 40.5447 44.5008 48.8837 18 19.6147 21.4123 23.4144 25.6454 28.1324 30.9057 33.9990 37.4502 41.3013 45.5992 50.3959 55.7497 19 20.8109 22.8406 25.1169 27.6712 30.5390 33.7600 37.3790 41.4463 46.0185 51.1591 56.9395 63.4397 20 22.0190 24.2974 26.8704 29.7781 33.0660 36.7856 40.9955 45.7620 51.1601 57.2750 64.2028 72.0524 7% 10% 11% 12% 1.0000 2.0700 1.0000 3.3100 4.6410