John Doe is in the 40 percent tax bracket. He is considering investing in HCA bonds that carry a 12 percent interest rate.
A. What is his after-tax interest rate on the bonds?
Health care finance - April, Tuesday, September 13, 2011 at 5:25pm
AT= BT * (1-T)
12% * (1-.40) = 7.2%
I think... almost positive that's the answer, hope it helps