Chapter 14 c - Differing tax rates on returns Interest...

Info iconThis preview shows pages 1–2. Sign up to view the full content.

View Full Document Right Arrow Icon
Differing tax rates on returns Interest payments and coupon payments taxed as ordinary income Capital gains from investments held one year or less are taxed as ordinary income Capital gains from investments held more than one year are subject to a long-term capital gains tax How wealth is influenced by your return on investment Any return saved increases the value of assets and therefore increases wealth Future value calculations can help estimate these increases Risk from investing Returns are uncertain Exposure to the economy Future values of investments are dependent on demand by investors Before you select an investment, you should assess the risk Measuring an investment’s risk Range of returns: returns of a specific investment over a given period Standard deviation: the degree of volatility in the stock’s return over time A risky stock will normally have a relatively wide range of returns and a
Background image of page 1

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full DocumentRight Arrow Icon
Image of page 2
This is the end of the preview. Sign up to access the rest of the document.

This note was uploaded on 02/22/2012 for the course FINANCE 250 taught by Professor Maryevans during the Spring '12 term at Rutgers.

Page1 / 2

Chapter 14 c - Differing tax rates on returns Interest...

This preview shows document pages 1 - 2. Sign up to view the full document.

View Full Document Right Arrow Icon
Ask a homework question - tutors are online