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Question 5 A farmer is planning on investing in land with real net returns of $29.44 per acre and assuming these real returns will increase
Question 5 A farmer is planning on investing in land with real net returns of $29.44 per acre and assuming these real returns will increase by 2.21% each year. The marginal tax rate is 15.63% and the inflation rate is 4.54%. This farmer is going to sell this piece of land in 3 years. (i) Calculate the real net return at the end of year 2. a. $30.76 b. $39.37 c. $33.55 d. $32.18 e. None of the answers are correct Enter Response Here: (ii) Calculate the nominal net return at the end of year 3. a. $35.91 b. $37.73 c. $32.15 d. $32.83 e. None of the answers are correct Enter Response Here: (iii) Calculate the after-tax nominal net return at the end of year 3. a. $35.91 b. $35.04 c. $30.30 d. $30.97 e. None of the answers are correct Enter Response Here: Question 5 A farmer is planning on investing in land with real net returns of $29.44 per acre and assuming these real returns will increase by 2.21% each year. The marginal tax rate is 15.63% and the inflation rate is 4.54%. This farmer is going to sell this piece of land in 3 years. (i) Calculate the real net return at the end of year 2. a. $30.76 b. $39.37 c. $33.55 d. $32.18 e. None of the answers are correct Enter Response Here: (ii) Calculate the nominal net return at the end of year 3. a. $35.91 b. $37.73 c. $32.15 d. $32.83 e. None of the answers are correct Enter Response Here: (iii) Calculate the after-tax nominal net return at the end of year 3. a. $35.91 b. $35.04 c. $30.30 d. $30.97 e. None of the answers are correct Enter Response Here
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