Calculate the amount of taxes b will pay on the interest

Reference no: EM131926555

Individual B buys a bond with a par value ofS1,000 and a coupon rate of 5% where the payments are made a The purchase price t expires in exactly 3 years and the par value will be paid at that time.

B is in the 20% tax bracket for capital gains and for interest income.

Calculate the amount of taxes B will pay on the interest income and the capital gains for this security over the three year period.

Reference no: EM131926555

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