When calculating return on net operating assets, interest expense net of tax is added back to net income for purposes of calculating the numerator. What tax rate should be used?

When calculating return on net operating assets, interest expense net of tax is added back to net income for purposes of calculating the numerator. What tax rate should be used? 




A. effective tax rate
B. marginal tax rate
C. statutory federal tax rate
D. statutory federal tax rate plus statutory state tax rate




Answer: B


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