How Is Alternative Minimum Taxable Income Computed

question 12

Essay

How is alternative minimum taxable income computed?

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Definitions:

CCC/CC/C Credit Ratings

Credit ratings given by rating agencies to denote high-risk bonds that are likely to default.

Inflation Premium

The extra yield that investors demand on securities to compensate for the risk of inflation reducing the value of future cash flows.

Fisher Effect

The Fisher Effect describes the relationship between nominal interest rates, real interest rates, and inflation, asserting that the nominal interest rate is equal to the real interest rate plus inflation.

Interest Rate Risk

The risk of changes in interest rates that can adversely affect the value of an investment.