Curtis Invests $250,000 in a City of Athens Bond That

question 67

Multiple Choice

Curtis invests $250,000 in a city of Athens bond that pays 7% interest. Alternatively, Curtis 8c4o) uld have invested the $250,000 in a bond recently issued by Initech, Inc. that pays 9% interest with similar risk as the city of Athens bond. Assume that Curtis' marginal tax rate is 28%.How much implicit tax would Curtis pay on the city of Athens bond?

• A) $1,400
• B) $5,000
• C) $17,500
• D) $1,300
• E) None of the choices are correct.

---

Definitions:

Great Depression

A severe worldwide economic downturn that lasted through the 1930s, marked by massive unemployment and financial instability.

Workplace Governance

The system by which a workplace is controlled and directed, encompassing policies, processes, and people.

Positive Force

A constructive influence or impact that leads to beneficial changes or outcomes.

Negative Force

An influence or factor that detracts from, hampers, or opposes positive outcomes or progress.