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The Omega Corporation has some excess cash it would like to invest in marketable securities for a long-term hold. Its Vice President of Finance is

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The Omega Corporation has some excess cash it would like to invest in marketable securities for a long-term hold. Its Vice President of Finance is considering three investments: (a) Treasury bonds at a 10 percent yleld; (b) corporate bonds at a 13 percent yield; or (a preferred stock at an 11 percent yield. Omega Corporation is in a 30 percent tax bracket and the tax rate on dividends is 15 percent 0-1. Compute the aftertax ylelds for the three investment options. (Do not round intermediate calculations. Input your answers as a percent rounded to 2 decimal places.) Answer is complete but not entirely corre rrect. Aftertax yields Treasury bonds 7.00% Corporate bonds 9.10% Preferred stock 6.57 X % a b C 0-2. Which one of the three investments should she select based on the aftertax yields? Preferred stock Treasury bonds Corporate bond

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