A 90 Percent Coupon Bond Issued by the State of Iowa

A 9.0 percent coupon bond issued by the State of Iowa sells for $1,000.What coupon rate on a corporate bond selling at $1,000 par value would produce the same after tax return to the investor as the municipal bond if the investor is in the 30 percent marginal tax bracket?

A) 6.30%
B) 6.92%
C) 11.70%
D) 12.86%
E) 15.25%