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George is comparing two investments, A and B. A pays its return in interest, whereas B is a growth investment whose return is in the
George is comparing two investments, A and B. A pays its return in interest, whereas B is a growth investment whose return is in the form of price appreciation. Assume George sells Investment Bafter one year. What is the difference between Investments A and Bon an after-tax return basis after one year if George's marginal tax rate is 32% and both investments are expected to earn 10% on an initial investment of $210000? There is no difference between the two. The after-tax return on Investment B is $2520 more than A. The after-tax return on Investment Bis $3570 more than A. The after-tax return on Investment A is $3570 more than B
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