Question
QUESTION 6 A firm that earns $1 million before tax in Brazil pays Brazilian tax of $250,000 and remits the remaining $750,000 as a dividend
QUESTION 6
A firm that earns $1 million before tax in Brazil pays Brazilian tax of $250,000 and remits the remaining $750,000 as a dividend to its U.S. parent. It pays a 5% dividend withholding tax on its remittance. Assuming a US tax rate of 35%, the parent will owe U.S. tax on this dividend of
$25,000 | ||
$52,500 | ||
$62,500 | ||
nothing. It will also receive a foreign tax credit of $90,000. |
5 points
QUESTION 7
Which one of the following securities in the foreign bond markets has the least amount of risk to the investor?
samurai bond | ||
shogun bond | ||
convertible bond | ||
equity warrants |
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