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Assume that Jose is indifferent between investing in a corporate bond that pays 10 percent...

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Question

Accounting

Assume that Jose is indifferent between investing in a corporate bond that pays 10 percent interest and a stock with no growth potential that pays an 9.3 percent dividend yield. Assume that the tax rate on dividends is 15 percent. What is Jose's marginal tax rate?

Multiple Choice

36.08 percent

26.21 percent

20.95 percent

13.56 percent

None of the choices are correct.

Answer & Explanation Solved by verified expert
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