Alan inherited $100,000 with the stipulation that he "invest it to financially benefit his family." Alan and Alice decided they would invest the inheritance to help them accomplish two financial goals: purchasing a Park City vacation home and saving for their son Cooper's education.

Alan and Alice have a marginal income tax rate of 30 percent (capital gains rate of 15 percent), and have decided to investigate the following investment opportunities.

Complete the two annual after-tax rates of return columns for each investment and provide investment recommendations for Alan and Alice.

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5 Years Annual After-Tax Rate of 18 Years Annual After-Tax Rate of etum etum Corporatebonds (ordinary interest taxed annually) Dividend-paying (no appreciation and dividends are taxed at 15%) Growth stock | 5.75% 475% stock 3.50% 3.50% Future Value is $65,000 3.20% Future Value is $140,000 Municipal bond (tax- exempt) 3.10%