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A bond issued by the State of Pennsylvania provides a 9 percent yield.

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A bond issued by the State of Pennsylvania provides a 9 percent yield. What yield on a Synthetic Chemical Company bond would cause the two bonds to provide the same after-tax rate of return to an investor in the 36 percent tax bracket?

14.06%
17.50%
7.00%
12.50%
9.00%.

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Solution Summary

This solution provides simple calculations for determining the bond yield.

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