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A n investor in a 30% marginal tax rate ask you for a recommendation in terms of after tax yield of 2 investment alternatives A.

A n investor in a 30% marginal tax rate ask you for a recommendation in terms of after tax yield of 2 investment alternatives

A. A 174 days Commercial Paper with $100,000 par value at a price of 96% of par.

B. A 14.5% coupon rate corporate bond

What is the difference in after tax yield between the bond and the commercial paper.

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