Arvo Corporation Is Trying to Choose Between Three Alternative Investments $8.80 \%$

question 24

Multiple Choice

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 $8.80 \%$ .
- Wooli Corporation bonds with a return of $11.75 \%$ .
- $\quad$ CFI Corp. preferred stock with a return of $9.80 \%$ .
?
The company's tax rate is 35.00%.What is the after-tax return on the best investment alternative? Assume a 70.00% dividend exclusion for tax on dividends.(Round your final answer to 3 decimal places. )

• A) 8.800%
• B) 8.624%
• C) 9.064%
• D) 8.448%
• E) 9.504%

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