Dana intends to invest $74,000 in either a Treasury bond or a corporate bond. The Treasury bond yields 5 percent before tax and the corporate bond yields 6 percent before tax.

a-1. How much interest after-tax would Dana earn by investing in the corporate bond?

b-1. If she were to move to another state where her marginal state rate would be 10 percent, which of the two options should she choose? Assume that Dana itemizes deductions.

Corporate/Treasury

b-2. How much interest after-tax would Dana earn by investing in the corporate bond as per requirement b-1?