What Would the After-Tax Yield Be on an Investment That

question 1

Multiple Choice

What would the after-tax yield be on an investment that offers a 6 percent fully taxable yield? Assume a marginal tax rate of 31%.

• A) 2.79%
• B) 6.48%
• C) 4.14%
• D) 7.20%
• E) 12.50%

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Definitions:

Past Event

A situation or occurrence that has already taken place.

Relevant

Pertaining to decision-making, it refers to information or costs that will change as a result of a decision, thereby affecting the outcome.

Total Cost

The sum of all expenses associated with the production or provision of goods and services, including fixed and variable costs.

Per Unit

A term referring to the cost, price, or measurement associated with a single unit of a product or service.