3. A taxable corporate bond issued by Delta Airlines is purchased by an investor with a 20% marginal tax rate. The bond has a yield of 5%. For a municipal bond issuer with similar risks, what would the yield have to be for the investor to be equally happy with the muni bond. In other words, what is the equivalent tax-exempt yield?

4. A bond has a 6.5% coupon rate, 12 years to maturity, $1,000 par value, semiannual coupons, and interest rate of 5%. What is the bond price?