# Annes marginal income tax rate is 32 percent. She purchases a corporate bond for $10,000 and the

## Question:

Anne’s marginal income tax rate is 32 percent. She purchases a corporate bond for $10,000 and the maturity, or face value, of the bond is $10,000. If the bond pays 5 percent per year before taxes, what is Anne’s annual after-tax rate of return from the bond if the bond matures in one year? What is her annual after-tax rate of return if the bond matures in 10 years?

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**Related Book For**

## Essentials Of Federal Taxation 2019

**ISBN:** 9781260190045

10th Edition

**Authors:** Brian Spilker, Benjamin Ayers, John Robinson, Edmund Outslay, Ronald Worsham, John Barrick, Connie Weaver