Use the Table for the Question(s) Below

question 60

Multiple Choice

Use the table for the question(s) below.
Consider the following top federal tax rates in the United States:
Personal Tax Rates
-In 2000,assuming an average dividend payout ratio of 50%,the effective tax advantage for debt (τ*) was closest to:

• A) 40%
• B) 24%
• C) 30%
• D) 18%