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Recently, April purchased a bond for $ 2 3 , 1 5 0 that pays a 8 % coupon, payable quarterly. The bond matures in
Recently, April purchased a bond for $ that pays a coupon, payable quarterly. The bond matures in years at a par value of $ She can reinvest the quarterly coupon at compounded annually. Her salary is $ per year. Her marginal tax rate is which is also the applicable tax rate on interest income. The tax rate on dividend income is and the tax rate on capital gain income is HINT: The first questions below are beforetax, the last one is aftertax.
What is her annualized HPR beforetax if she does not reinvest her investment income?
What is her annualized HPR beforetax if she reinvests her investment income?
What is her annualized HPR aftertax if she reinvests her investment income and taxes are paid annually?
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