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Annual cash flow from a new investment is projected to beAs the y

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Annual cash flow from a new investment is projected to be:
As the year 1 through 4 cash flows are realized it is
anticipated that they will be invested in treasury bonds
paying 14% annual interest and maturing at year 4.
Calculate the DCFROR on the investment, assuming a
42% income tax rate is relevant and that after-tax treasury
bond interest will be reinvested each year in identical
bonds.
Annual cash flow from a new investment is projected to be:
As the year 1 through 4 cash flows are realized it is
anticipated that they will be invested in treasury bonds
paying 14% annual interest and maturing at year 4.
Calculate the DCFROR on the investment, assuming a
42% income tax rate is relevant and that after-tax treasury
bond interest will be reinvested each year in identical
bonds. A) 26.12%
B) 28.86%
C) 25.33%
D) 27.19% Annual cash flow from a new investment is
projected to be: As the year 1 through 4 cash flows are
realized it is anticipated that they will be invested in
treasury bonds paying 14% annual interest and maturing at
year 4. Calculate the DCFROR on the investment,
assuming a 42% income tax rate is relevant and that after-
tax treasury bond interest will be reinvested each year in
identical bonds. A) 26.12% B) 28.86% C) 25.33% D)
27.19%
Solution

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Annual cash flow from a new investment is projected to be: As the year 1 through 4 cash flows are realized it is anticipated that they will be invested in treasury bonds paying 14% annual interest and maturing at year 4. Calculate the DCFROR on the investment, assuming a 42% income tax rate is relevant and that after -tax treasury bond interest will be reinvested each year in identical bonds. Annual cash flow from a new investment is projected to be: As the year 1 through 4 cash flows are realized it is anticipated that they will be invested in treasury bonds paying 14% annual interest and mat ...
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