Question: Hi, I need help with this question please. Thank you Company ABC pays corporate tax at the 35% rate. Company ABC can buy a bond

Hi, I need help with this question please.

Thank you

Company ABC pays corporate tax at the 35% rate. Company ABC can buy a bond in firm

XYZ yielding 12 % annual interest or a preferred stock in firm XYZ yielding a 9% annual

dividend payment. Which choice will provide a higher after-tax return to Company ABC?

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