A 5-year corporate bond yields 9%.A 5-year municipal bond of equal risk yields 6.5%.Assume that the state tax rate is zero.At what federal tax rate are you indifferent between the two bonds?
A) 27.78%
B) 29.17%
C) 30.63%
D) 32.16%
E) 33.76%
Correct Answer:
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