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Actual After-Tax Rate of Return. [Engineering Economics]

  1. Jul 9, 2009 #1

    I'm trying to solve a 3 part problem which has the following questions:

    a) Determine the rate of return before taxes.
    After Solving: Answer: 21 %

    b) If the effective income tax rate is 42 percent, what is the approximate after-tax rate of return?
    After Solving: Answer: 8 %

    c) What is the actual after-tax rate of return?
    I don't really understand this question, I can't tell the difference between (approximate after-tax rate of return) and (actual after-tax rate of return)

    Does anyone Know the difference?

  2. jcsd
  3. Jul 11, 2009 #2


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    Welcome to Physics Forums.

    I'm not sure either. Could you post:

    • The full problem statement.
    • The equations you used to get your answers.
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