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A corporation in a 21% tax bracket invests in the preferred stock of another company and earns a 6% pretax rate of return. An individual

A corporation in a 21% tax bracket invests in the preferred stock of another company and earns a 6% pretax rate of return. An individual investor in a 15% tax bracket invests in the same preferred stock and earns the same pretax return. The after-tax return to the corporation is _______, and the after-tax return to the individual investor is _______.

  • 3.96%; 5.10%

  • 5.37%; 5.10%

  • 6.00%; 6.00%

  • 3.96%; 6.00%

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