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    What Is the Effective After-Tax Yield to an Investor from a Bond
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What Is the Effective After-Tax Yield to an Investor from a Bond

Question 114

Question 114

Essay

What is the effective after-tax yield to an investor from a bond paying $70 per $1,000 annually, if the investor is in a 25% marginal tax bracket? Explain.

Correct Answer:

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5.25%. The $70 is taxed at 25%...

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