Hugh has the choice between investing in a city of heflin bond at 6.45 percent or a surething bond at 10.40 percent. assuming that both bonds have the same nontax characteristics and that hugh has a 40 percent marginal tax rate. what interest rate does surething inc., need to offer to make hugh indifferent between investing in the two bonds?

Surething Inc. must give an interest rate of 17.33 percent to generate a 10.40 percent after-tax return and make Hugh indifferent between investing in the two bonds.

To solve for the pretax rate of return, we can use this formula:

 After-tax return = Pre-tax return x (1 – Marginal Tax Rate).

10.40% = Pre-tax return x (1 – Marginal Tax Rate);

Pre-tax return = 10.40% / (1 – Marginal Tax Rate) = 17.33%

In the problem we are asked to find the probability that 2 girls are between a pair of boys. Hence we can generate the following arrangements:

b g g b g g b g g g g                           -- arrangement 1

In this situation, we are only interested on the part between the boys, hence we create a boundary just for the sake of calculation.

|b g g b g g b| g g g g                       -- arrangement 2

To solve this problem, we use the Combination formula: nCr = n! / n! (n-r)!

We can see in the above arrangement 2, that for the 3 boys there are 7 places which he can take, therefore:

7C3 = 7! / 7! (7-3)!

7C3 = 35

While the total places the 3 boys can take are 11 based on arrangement 1, therefore:

11C3 = 11! / 11! (11-3)!

11C3 = 165

Therefore the probability that two girls will be between two boys is:

Probability = 35 / 165

Probability = 0.2121

Therefore there is a 21.21% probability that 2 girls is between 2 boys.