John has a choice of a municipal bond with a 5% yield and a taxable bond with a 6% yield. Assuming his marginal tax rate is 40%, find the difference between the two bonds on a pretax equivalent basis and his choice should be::

	a.	1.7% and select the municipal bond.
	b.	1.7% and select the taxable bond.
	c.	2.3% and select the municipal bond.
	d.	2.3% and select the taxable bond.
	e.	3.0% and select the municipal bond.