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 6 percent yield; (b) corporate bonds at a 12 percent yield; or (c) preferred stock at an 8 percent yield. Omega Corporation is in a 40 percent tax bracket and the tax rate on dividends is 10 percent

Treasury Bonds 3.60%

Corporate Bonds 7.20%

Preferred Stock

(I am stuck on preferred stock, the answer is NOT 7.20 and its NOT 7.68)