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An investor in the 28% tax bracket is trying to decide which of two bonds to select: one is a 7.4% U.S. Treasury bond selling

An investor in the 28% tax bracket is trying to decide which of two bonds to select: one is a 7.4% U.S. Treasury bond selling at par; the other is a municipal bond with a 5.6% coupon, which is also selling at par. Which of these two bonds should the investor select?

Answer 1.- Municipal Bond or U.S treasury Bond

And why?

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