A rational investor will require the same after-tax return from a corporate security as from a government security.

Question

Quizplus · Accepted Answer

A rational investor will require the same after-tax return from any investment, regardless of whether it is a corporate security or a government security. This is because the investor is ultimately interested in the return they will receive after taxes, and the tax treatment of the investment will affect the overall return.

A Rational Investor Will Require the Same After-Tax Return from a Corporate