Which of the Following Statements Is False

question 60

Multiple Choice

Which of the following statements is false?

• A) The actual return kept by an investor will depend on how the interest is taxed.
• B) The equivalent after-tax interest rate is r(1 - τ).
• C) The highest interest rate for a given horizon is the rate paid on Treasury Bills of the Government of Canada.
• D) It is important to use a discount rate that matches both the horizon and the risk of the cash flows.