Question
13. An investor is in a 30% combined federal plus state tax bracket. If corporate bonds offer 6% yields, what yield must municipals offer
13. An investor is in a 30% combined federal plus state tax bracket. If corporate bonds offer 6% yields, what yield must municipals offer for the investor to prefer them to corporate bonds? 14. Find the equivalent taxable yield of a short-term municipal bond with a yield of 4% for tax brackets of (a) zero, (b) 10%, (c) 20%, and (d) 30%.
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ISE Investments
Authors: Zvi Bodie, Alex Kane, Alan Marcus
12th International Edition
1260571157, 978-1260571158
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