Jewels can expect a total of $17,125 + $29,000 = $46,125 in student loans when she graduates from her master’s program. At an 8 percent rate of interest, the yearly interest charges will be $3,690 immediately after she graduates (though they will go down once she starts paying off some of the principal). Since the yearly interest will be more than the allowable $2,500 deduction, we can express her after-tax interest rate(with a tax-rate of 22 percent) as the following weighted average: Multiple Choice 2.50 percent 8.00 percent 3.23 percent 6.81 percent

Jewels can expect a total of $17,125 + $29,000 = $46,125 in student loans when she graduates from her master’s program. At an 8 percent rate of interest, the yearly interest charges will be $3,690 immediately after she graduates (though they will go down once she starts paying off some of the principal). Since the yearly interest will be more than the allowable $2,500 deduction, we can express her after-tax interest rate(with a tax-rate of 22 percent) as the following weighted average: Multiple Choice 2.50 percent 8.00 percent 3.23 percent 6.81 percent

Pfin (with Mindtap, 1 Term Printed Access Card) (mindtap Course List)

7th Edition

ISBN:9780357033609

Author:Randall Billingsley, Lawrence J. Gitman, Michael D. Joehnk

Publisher:Randall Billingsley, Lawrence J. Gitman, Michael D. Joehnk

Chapter13: Investing In Mutual Funds, Etfs, And Real Estate

Section: Chapter Questions

Problem 9FPE

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