What tax rate would make the law of one price hold

Reference no: EM13908684

Assume the data shown below. What tax rate would make the law of one price hold? Assume that the capital gains tax is one-half the ordinary income tax. Assume that the periods shown are annual and that any capital gain or loss is realized at the time the bond matures.

Bond	1	2	Price
A	80	1,080	985
B	1,100		900
C	120	1,120	1,040

Reference no: EM13908684

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