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Carter Corporation has some money to invest, and its treasurer is choosing between City of Chicago municipal bonds and U.S. Treasury bonds. Both have the same maturity, and they are equally risky and liquid. If Treasury bonds yield 6%, and Carter's marginal income tax rate is 16%, what yield on the Chicago municipal bonds would make Carter's treasurer indifferent between the two? O a. 5.19% O b. 6.30% C. 4.94% O d. 5.04% O e. 4.28% Watson Oil recently reported in millions) $8,250 of sales, $5,750 of operating costs other than depreciation, and $1,175 of depreciation. The company had $3,200 of outstanding bonds that carry a 5% interest rate, and its ate, and its federal-plus-state income tax rate was 35%. In order to sustain its operations and thus generate future sales and cash flows, the firm was required to make $1,250 of capital expenditures on new fixed assets and to invest $300 in net operating working capital. By how much did the firm's net income exceed its free cash flow? O a. $220 Ob. $249 O c. $238 d. $271 O e. $236