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19 April, 15:10

Brent, a single taxpayer, has a 24% marginal tax rate. He is considering an investment that will earn qualified dividends at a rate of 7% before tax. What is Brent's after-tax rate of return on the securities

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  1. 19 April, 16:25
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    Brent's after-tax rate of return on the securities is 5.32%

    Explanation:

    Given a 7% before tax dividend rate and a 24% marginal tax rate, the after-tax rate of return will be 5.32% (7% x (100%-24%).
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