A bank is considering an investment in a municipal security that offers a yield of 4...
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A bank is considering an investment in a municipal security that offers a yield of 4 percent. What is this security’s equivalent pre-tax yield if the bank’s tax rate is 30 percent? (Round your answer to 2 decimal places. (e.g., 32.16)) |
| Security’s equivalent pre-tax yield | % |
Homework Answers
| Dear Student | |
| Thank you for using Chegg | |
| Please find below the answer | |
| Statementshowing Computations | |
| Paticulars | Amount |
| Yield offered by security | 4% |
| Tax rate | 30% |
| Security’s equivalent pre-tax yield = 4%/.70 | 5.71% |
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