The interest can be reinvested at 5% before tax

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A taxpayer is considering three alternative investments of $10,000. Assume that the taxpayer is in the 28% marginal tax bracket for ordinary income and 15% for qualifying capital gains in all tax years. The selected investments will be liquidated at the end of five years. The alternatives are: A taxable corporate bond yielding 5% before tax, and the interest can be reinvested at 5% before tax

Reference no: EM13336415

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