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Mike is trying to compare the following two bonds trading at par: Bond A: 4% YTM, 15 year Treasury Note (taxable) Bond B: 3.25% YTM,
Mike is trying to compare the following two bonds trading at par: Bond A: 4% YTM, 15 year Treasury Note (taxable) Bond B: 3.25% YTM, 15 year Houston Municipal Bond (tax exempt). Calculate the marginal tax rate that would make the investor indifferent between purchasing these bonds. (Enter percentages as decimals and round to 4 decimals).
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