Laura Has an Average Tax Rate of 15% and a Marginal

question 67

Multiple Choice

Laura has an average tax rate of 15% and a marginal tax rate of 24%. What is her aftertax yield on a corporate bond which has a 4.5% yield?

• A)2.34%
• B)3.24%
• C)3.42%
• D)4.23%
• E)4.32%

---

Definitions:

Machine-hours

measures the total time that machines are operating, often used as a basis for allocating manufacturing overhead to products.

Fixed Cost

Fixed costs are unaffected by the volume of production or sales, covering expenditures like rental fees, salaries, and insurance charges.

Assembly Department

A section or division within a manufacturing facility where various components are assembled into final products, playing a crucial role in the production process.

Service Costs

Service costs entail the expenses associated with providing services, including labor, materials, and overhead.