Suppose that, holding yield constant, investors are indifferent as to whether they hold bonds issued by the federal government or bonds issued by state

and local governments $($that is$,$ they consider the bonds the same with respect to default risk, information costs, and liquidity$).$ Suppose that state

governments have issued perpetuities $($or consoles$)$ with $$83$ coupons and that the federal government has also issued perpetuities with $$83$ coupons. If

the state and federal perpetuities both have after$-$tax yields of $7\%,$ what are their pre$-$tax yields? $($Assume that the relevant federal income tax rate is

$33\mathrm{.}61\%.$

The pre$-$tax yield on the state perpetuity will be

$\%.($Round your response to two decimal places.$)$