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Unformatted text preview: US corporate bonds is going to widen, which of the following is most likely to be TRUE: a. The economy is going to expand b. The economy is going to contract c. There will be no change to the economy d. The US dollar will weaken 5) For two bonds that are alike in all respects except credit risk, the yield ratio is 1.0833. If the yield on the higher yield bond is 6.5%, the lower yield bond is closest to: a. 8.33% b. 5.50% c. 7.04% d. 6.00% 6) Given two bonds that are equivalent in all respects except tax status, the marginal tax rate that will make an investor indifferent between an 8.2% taxable bond and a 6.2% tax-exempt bond is closest to: a. 24.39% b. 76.61% c. 37.04% d. 43.47%...
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This note was uploaded on 11/06/2010 for the course ECON Econ taught by Professor Liasa during the Spring '10 term at University of San Francisco.
- Spring '10