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A five-year 10% bond with semiannual coupons and maturity value at par of $700 is purchased for $670. The income tax rate is a level

A five-year 10% bond with semiannual coupons and maturity value at par of $700 is purchased for $670. The income tax rate is a level 25% over the entire period.

a) Find the before-tax effective yield rate

b) Find the after-tax effective yield rate, if all investment income is fully taxed as it is earned

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