Assume That Keisha's Marginal Tax Rate Is 40% and Her

Assume that Keisha's marginal tax rate is 40% and her tax rate on dividends is 15%. If a city of Atlanta bond pays 7.65% interest, what dividend yield would a dividend-paying stock (with no growth potential) have to offer for Keisha to be indifferent between the two investments from a cash-flow perspective?

A) 15%.
B) 10%.
C) 9%.
D) 7.65%.
E) None of these.