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1. Motorhead Automotive Inc. issued a bond yields 88. A muni bond of comparable maturity and credit quality yields 68. For each marginal tax rate

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1. Motorhead Automotive Inc. issued a bond yields 88. A muni bond of comparable maturity and credit quality yields 68. For each marginal tax rate below, determine the after-tax yield of each bond and state which would be preferable for an investor in each of the marginal tax brackets. Marginal Tax Rate Muni: After- Tax Corporate: After Tax Preferred Investment 0% 20% 25% 30%

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