Dana is considering investing $20,000 in one of two investments. The income from Investment A is $2,300. The income from Investment B is $3,000. The income from Investment A would be received at the end of the current year and would be excluded from tax. The income from Investment B would also be received at the end of the current year, but would be subject to tax in 3 years under a special deferral provision. How would you advise Dana? Discuss the factors that are necessary to determine which of the two investments provides the greater after-tax yield.

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The Answer of Dana is considering investing $20,000 in one of two investments. The income from Investment A is $2,300. The income from Investment B is $3,000. The income from Investment A would be received at the end of the current year and would be excluded from tax. The income from Investment B would also be received at the end of the current year, but would be subject to tax in 3 years under a special deferral provision. How would you advise Dana? Discuss the factors that are necessary to determine which of the two investments provides the greater after-tax yield.

Dana Is Considering Investing $20,000 in One of Two Investments