You Are Considering the Purchase of a Tax-Exempt Security That

question 53

Multiple Choice

You are considering the purchase of a tax-exempt security that is paying a yield of 10.08 percent. You are in the 28 percent tax bracket. To match this after-tax yield, you would consider taxable securities that pay

• A)31.1 percent.
• B)19 percent.
• C)12.5 percent.
• D)14 percent.

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Definitions:

Prima facie case

Evidentiary standard that requires sufficient evidence to prove the case in the absence of any contradictory evidence.

Sincerely held religious belief

A genuine and meaningful belief that occupies a place in the life of its possessor parallel to that filled by the orthodox belief in God within recognized religions.

Strict scrutiny

A judicial review test used by courts to determine the constitutionality of certain laws, requiring the law to serve a compelling state interest in the least restrictive way.

Constitutional grounds

The basis or foundation in a country's constitution that supports or legitimizes laws, actions, or legal decisions.