At the beginning of the year, you purchased a 5-year zero coupon bond with a yield to maturity of 6.80% and a face value of $1,000. Your tax rate is 30.00%. What is the total tax that you will have to pay on the bond during the first year? Do not round your intermediate calculations.
A. $18.06
B. $12.63
C. $14.68
D. $13.65
E. $13.36
Answer: C
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