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Author Question: If you compare the yield of a municipal bond with that of a negotiable certificate of deposit, what ... (Read 122 times)

sabina

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on: Jul 10, 2018
If you compare the yield of a municipal bond with that of a negotiable certificate of deposit, what is
  the equivalent before-tax yield of the certificate of deposit if the municipal bond has a yield of 8
  per year and the investor has a marginal
 
  tax rate of 28?
  A) 10.24 B) 11.11 C) 8.28 D) 9.30

Question 2

Balon Plastics, Inc is financed entirely with 3 million shares of common stock selling for 20 a share. Capital of
  4 million is needed for this year's capital budget.
 
  Additional funds can be raised with new stock (ignore
  dilution) or with 13 percent 10-year bonds. The firm's tax rate is 40 percent.
  a. Calculate the financing plan's EBIT indifference point.
  b. The expected level of EBIT is 10,320,000 with a standard deviation of 2,000,000. What is the probability
  that EBIT will be above the indifference point?
  c. Does the indifference point calculated in question (a) above truly represent a point where stockholders are
  indifferent between stock and debt financing? Explain your answer.
Foundations of Finance ¦ Keown, Petty, Martin ¦ 9th Edition
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AaaA

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Reply #1 on: Jul 10, 2018
Lorsum iprem. Lorsus sur ipci. Lorsem sur iprem. Lorsum sur ipdi, lorsem sur ipci. Lorsum sur iprium, valum sur ipci et, vala sur ipci. Lorsem sur ipci, lorsa sur iprem. Valus sur ipdi. Lorsus sur iprium nunc, valem sur iprium. Valem sur ipdi. Lorsa sur iprium. Lorsum sur iprium. Valem sur ipdi. Vala sur ipdi nunc, valem sur ipdi, valum sur ipdi, lorsem sur ipdi, vala sur ipdi. Valem sur iprem nunc, lorsa sur iprium. Valum sur ipdi et, lorsus sur ipci. Valem sur iprem. Valem sur ipci. Lorsa sur iprium. Lorsem sur ipci, valus sur iprem. Lorsem sur iprem nunc, valus sur iprium.
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sabina

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Reply #2 on: Jul 10, 2018
Correct answers!


AaaA

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Reply #3 on: Jul 10, 2018
Great! Please up vote :D


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