Suppose a 10-year US Treasury Note is yielding 1.56%, and a 10-year Space County Note is yield 1.27%.  If an investor has a marginal tax rate of 20%, calculate the after-tax yield for the taxable bond.  (Enter percentages as decimals and round to four decimals)

2) Suppose a 10-year US Treasury Note is yielding 1.56%, and a 10-year Space County Note is yield 1.27%.  If an investor has a marginal tax rate of 20%, calculate the tax equivalent yield for the tax exempt bond.

Answer rating: 100% (QA)

To calculate the aftertax yield for the taxable bond we need to subtract the tax amount f... View the full answer