Multiple Choice
A corporation recently purchased some preferred stock that has a before-tax yield of 6.50%.The company has a tax rate of 38%.What is the after-tax return on the preferred stock? Assume a 70% dividend exclusion for tax on dividends.(Round your final answer to two decimal places. )
A) 5.87%
B) 5.76%
C) 6.05%
D) 6.68%
E) 6.85%
Correct Answer:
Verified
Correct Answer:
Verified
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