Year Corporate Tax Rate Interest Income Average Rate on Equity Income Dividends Capital Gains 1971-1978 48% ...

Year   Corporate Tax Rate   Interest Income   Average Rate on Equity Income   Dividends   Capital
Gains
1971-1978   48%   70%   53%   70%   35%
1979-1981   46%   70%   49%   70%   28%
1982-1986   46%   50%   35%   50%   20%
1987   40%   39%   33%   39%   28%
1988-1990   34%   28%   28%   28%   28%
1991-1992   34%   31%   30%   31%   28%
1993-1996   35%   40%   34%   40%   28%
1997-2000   35%   40%   30%   40%   20%
2001-2002   35%   39%   30%   39%   20%
2003-2012   35%   35%   15%   15%   15%

Use the data in the table, to calculate the tax disadvantage of retained cash in:

a.1978

b. 1998

c. 1976

Solutions

Expert Solution

To calculate tax disadvantage of retained cash we need to use the below mentioned formula and required data needed to be acquired from the given table

ekkarill92 answered 1 year ago

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