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In order for an investor to compare the yields between taxable and tax-free bonds, an equivalent yield will need to be computed. For an investor

In order for an investor to compare the yields between taxable and tax-free bonds, an equivalent yield will need to be computed. For an investor in a 28% marginal tax rate, what is an equivalent tax-free yield for a taxable bond yielding 4.5%?

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2.25%

2.98%

3.24%

4.10%

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