A property produces an after tax internal rate of return of 12.24%.If the investor has a marginal tax rate of 31%,what is the before-tax equivalent yield?

Name: A property produces an after tax internal rate of return of 12.24%.If the investor has a marginal tax rate of 31%,what is the before-tax equivalent yield?
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Question

Quizplus · Accepted Answer

The before-tax equivalent yield can be calculated using the formula: Before-tax yield = After-tax yield / (1 - tax rate). Plugging in the values: 12.24% / (1 - 0.31) = 17.74%.

A Property Produces an After Tax Internal Rate of Return