Dennis is currently considering investing in municipal bonds that earn 7.65 percent interest, or in taxable bonds issued by the Coca-Cola Company that pay 10.2 percent.

a. If Denniss tax rate is 20 percent, which bond should he choose?

	Municipal bonds
	Taxable bonds

b. Which bond should he choose if his tax rate is 30 percent?

	Municipal bonds
	Taxable bonds

c. At what tax rate would he be indifferent between the bonds?

d. What strategy is this decision based upon?

	Development planning strategy
	Business planning strategy
	Decision planning strategy
	Marketing planning strategy
	Conversion planning strategy
	Timing strategy
	Income shifting strategy