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Dana intends to invest $ 4 2 , 0 0 0 in either a Treasury bond or a corporate bond. The Treasury bond yields 5
Dana intends to invest $ in either a Treasury bond or a corporate bond. The Treasury bond yields percent before tax and the
corporate bond yields percent before tax.
Required:
a Assuming Dana's federal marginal rate is percent and her marginal state rate is percent, which of the two options should she
choose? Assume that Dana itemizes deductions.
a How much interest aftertax would Dana earn by investing in the corporate bond?
Note: Do not round intermediate calculations and round your final answer to the nearest whole dollar amount.
b If she were to move to another state where her marginal state rate would be percent, which of the two options should she
choose? Assume that Dana itemizes deductions.
b How much interest aftertax would Dana earn by investing in the corporate bond as per requirement b
Note: Do not round intermediate calculations and round your final answer to the nearest whole dollar amount.
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