Curtis invests $250,000 in a city of Athens bond that pays 7% interest.Alternatively,Curtis could have invested the $250,000 in a bond recently issued by Initech,Inc.that pays 9% interest with similar risk as the city of Athens bond.Assume that Curtis's marginal tax rate is 24%. How much implicit tax would Curtis pay on the city of Athens bond?
A)$17,500
B)$1,400
C)$1,300
D)$5,000
E)None of the choices are correct.

Question

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The Answer of Curtis invests $250,000 in a city of Athens bond that pays 7% interest.Alternatively,Curtis could have invested the $250,000 in a bond recently issued by Initech,Inc.that pays 9% interest with similar risk as the city of Athens bond.Assume that Curtis's marginal tax rate is 24%. How much implicit tax would Curtis pay on the city of Athens bond?
A)$17,500
B)$1,400
C)$1,300
D)$5,000
E)None of the choices are correct.

Curtis Invests $250,000 in a City of Athens Bond That