Question

In: Finance

The Nash Corp. is considering four investments. Which provides the highest after-tax return for Nash Corp....

The Nash Corp. is considering four investments. Which provides the highest after-tax return for Nash Corp. if it is in the 21% federal tax bracket? Assume the tax rate on dividends is 15%.

  • Treasury bonds at 4%

  • Preferred stock at 7.5%

  • Corporate bonds at 7.5%

  • Municipal bonds at 7.25%

Solutions

Expert Solution

SEE THE IMAGE. ANY DOUBTS, FEEL FREE TO ASK. THUMBS UP PLEASE

jeff jeffy answered 1 month ago
Next > < Previous

Related Solutions

Which one of the following investments provides the highest effective annual rate of return (i.e., which...
Which one of the following investments provides the highest effective annual rate of return (i.e., which of the following investments is the BEST = the largest EAR) over an investment horizon of 10 years)? a. An investment which has a 3.0 percent nominal rate with annual compounding. b. An investment which has a 2.98 percent nominal rate with semi-annual compounding. c. An investment which has a 2.965 percent nominal rate with quarterly compounding. d. An investment which has a 2.9575...
Which one of the following investments provides the highest effective annual rate of return (i.e., which...
Which one of the following investments provides the highest effective annual rate of return (i.e., which of the following investments is the BEST = the largest EAR) over an investment horizon of 10 years)? a. An investment which has a 3.0 percent nominal rate with annual compounding. b. An investment which has a 2.98 percent nominal rate with semi-annual compounding. c. An investment which has a 2.965 percent nominal rate with quarterly compounding. d. An investment which has a 2.9575...
11. Which one of the following investments provides the highest effective annual rate of return (i.e.,...
11. Which one of the following investments provides the highest effective annual rate of return (i.e., which of the following investments represents the largest EAR), assuming an investor wants to avoid earning the lowest return over an investing horizon of 10 years? a. An investment which has a 3.0 percent nominal rate with annual compounding. b. An investment which has a 2.98 percent nominal rate with semi-annual compounding. c. An investment which has a 2.965 percent nominal rate with quarterly...
Which of the following investments has the highest effective return? (All are of equal risk) A...
Which of the following investments has the highest effective return? (All are of equal risk) A bank CD which pays 10%, compounded monthly A bank CD which pays 10.5%, compounded annually A bank CD which pays 10%, compounded quarterly A bank CD which pays 10.3%, compounded semiannually A bank CD which pays 9.6%, compounded daily (on a 365-day basis)
Which of the investments discussed has had the highest average return and risk premium? I Which...
Which of the investments discussed has had the highest average return and risk premium? I Which of the investments discussed has had the highest standard deviation? I What is capital market efficiency? I What are the three forms of market efficiency?
Find the real return, nominal after-tax return, and real after-tax return for each of the following...
Find the real return, nominal after-tax return, and real after-tax return for each of the following stocks: Stock Nominal Return Inflation Tax Rate X 13.5% 5% 15% Y 8.7% 4.7% 25% Z 5.2% 2.5% 28%   
Compare the after-tax rates of return for a Canadian corporate investor from the following two investments:...
Compare the after-tax rates of return for a Canadian corporate investor from the following two investments: A 20-year, Canadian corporate bond that sells for par and offers a 9 percent coupon versus an investment in preferred stock that sells for $40.00 per share and pays a $2.40 dividend. The corporation has a 35 percent tax rate.
Which of the following investments provides the least variability and risk? a. Investment B: Avg. return...
Which of the following investments provides the least variability and risk? a. Investment B: Avg. return = 12%, std. deviation = 5% b. Investment D: Avg. return = 12%, std. deviation = 8% c. Investment A: Avg. return = 25%, std. deviation = 18% d. Investment C: Avg. return = 8%, std. deviation = 2%
PLEASE SHOW CALCULATIONS 1. Find the real return, nominal after-tax return, and real after-tax return for...
PLEASE SHOW CALCULATIONS 1. Find the real return, nominal after-tax return, and real after-tax return for each of the following stocks: Stock Nominal Return Inflation Tax Rate X 13.5% 5% 15% Y 8.7% 4.7% 25% Z 5.2% 2.5% 28% 2.) Compute the holding period returns for each security below: Security Price Today Price One Year Ago Dividends Received Interest Received RR $20.05 $18.67 $0.50 WC $33.42 $45.79 $1.10 AC $1,015.38 $991.78 $100.00
Sansuit Investments is deciding on future investments for the coming two years and is considering four...
Sansuit Investments is deciding on future investments for the coming two years and is considering four bonds. The investment details for the next two years are given in the table below.The net worth of these four bonds at maturity is $60,000, $40,000, $25,500, and $18,000, respectively. The firm plans to invest $35,000 and $62,000 in Year 1 and Year 2, respectively. Develop and solve a binary integer programming model for maximizing the net worth Investment Requirements ($) Year 1 Year...
ADVERTISEMENT
Subjects
ADVERTISEMENT
Latest Questions
ADVERTISEMENT