Nancy invests $200,000 in a City of Heflin bond that pays 6 percent interest. Alternatively, Nancy could have invested the $200,000 in a bond recently issued by Everything Incorporated that pays 8 percent interest and has risk and other nontax characteristics similar to the City of Soma bond. Assume Nancy's marginal tax rate is 25 percent.

Note: Leave no cells blank - be sure to enter "0" wherever required.

Required:

1. What is her after-tax rate of return for the City of Soma bond?
2. How much explicit tax does Melinda pay on the City of Soma bond?
3. How much implicit tax does she pay on the City of Soma bond?
4. How much explicit tax would she have paid on the Everything Incorporated bond?
5. What is her after-tax rate of return on the Everything Incorporated bond?