Suppose that the yield to maturity of the 4% coupon, 30-year maturity bond falls to 7% by
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Suppose that the yield to maturity of the 4% coupon, 30-year maturity bond falls to 7% by the end of the first year, and that the investor sells the bond after the first year. If the investor’s federal plus state tax rate on interest income is 38% and the combined tax rate on capital gains is 20%, what is the investor’s after-tax rate of return?
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Related Book For 
Essentials Of Investments
ISBN: 9780073368719
7th Edition
Authors: Zvi Bodie, Alex Kane, Alan J. Marcus
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