On an unadjusted basis, yields on municipal securities are greater than the yields on corporate securities, everything else the same.

Question

Quizplus · Accepted Answer

Municipal securities typically offer lower yields than corporate securities because the interest income from municipal bonds is often exempt from federal income taxes and sometimes from state and local taxes as well, making them more attractive to investors in high tax brackets despite their lower yields.

On an Unadjusted Basis, Yields on Municipal Securities Are Greater