Lenz has $100,000 in an investment paying 9% annual interest. Her marginal tax rate is 25%. Which of the following statements is false?
A) Ms. Lenz's annual before-tax cash flow from this investment is $9,000.
B) If the interest is tax-exempt, Ms. Lenz's annual after-tax cash flow is $9,000.
C) If the interest is taxable, Ms. Lenz's annual after-tax cash flow is $6,750.
D) None of the above is false.
Correct Answer:
Verified
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