Arvo Corporation is trying to choose between three alternative investments. The three securities that the company is
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Arvo Corporation is trying to choose between three alternative investments. The three securities that the company is considering are as follows:
∙ Tax-free municipal bonds with a return of 8.90%. |
∙ Wooli Corporation bonds with a return of 11.30%. |
∙ CFI Corp. preferred stock with a return of 9.40%. |
The company's tax rate is 25.00%. What is the after-tax return on the best investment alternative? Assume a 50.00% dividend exclusion for taxes on dividends. (Round your final answer to 3 decimal places.)
Related Book For
Essentials Of Corporate Finance
ISBN: 9780073405131
6th Edition
Authors: Stephen A. Ross, Randolph Westerfield, Bradford D. Jordan
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