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An investor purchases one municipal bond and one corporate bond that pay rates of return of 5% and 6.4%, respectively. If the investor is in

An investor purchases one municipal bond and one corporate bond that pay rates of return of 5% and 6.4%, respectively. If the investor is in the 15% tax bracket, find the after-tax rates of return on the municipal and corporate, respectively.

the investor would prefer which security?

What is the cutoff tax rate for the tax exempt and taxable securities?

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