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Assume you are in the 15 percent tax bracket. What tax-exempt return would a municipal bond need to pay to have a taxable equivalent yield
Assume you are in the 15 percent tax bracket. What tax-exempt return would a municipal bond need to pay to have a taxable equivalent yield of 5.00%. Calculate the tax-exempt return using the formula: Taxable equivalent yield = Tax-exempt return / (1.0 Your tax rate)
A) 4.25%
B) 5.10%
C) 3.75%
D) 4.50%
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