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The Shrieves Corporation has $10,000 that it plans to invest in marketable securities. It is choosing among AT&T bonds, which yield 10%, state of Florida muni bonds, which yield 6% (but are not taxable), and AT&T preferred stock, with a dividend yield of 8.5%. Shrieves's corporate tax rate is 35%, and 70% of the dividends received are tax exempt. Find the after-tax rates of return on all three securities. Round your answers to two decimal places.

After-tax rate of return on AT&T bond   %

After-tax rate of return on Florida main bonds   %

After-tax rate of return on AT&T preferred stock              %

Financial Management, Finance

  • Category:- Financial Management
  • Reference No.:- M91564658

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