om has come in to see you to discuss the purchase of a fixed income option for his portfolio (either a bond or a GIC). He has a large company pension plan, so he has no RRSP contribution room and, therefore, he has maxed-out his TFSA contributions also. The investments which you are discussing today will be held in a non- registered (i.e. fully taxable) account. Tom lives in Calgary, Alberta and has a marginal tax rate of 36% and expects that to remain constant going forward. He has $78,300 that he wants to invest for the next 5 years at which time, he intends to sell the investment and use the proceeds towards the purchase of a parcel of land. The options that you are discussing with Tom today are: A 5-year GIC at annual compounded rate of 4.25%. An investment grade Canadian Corporate bond with a par value of $1,000 and exactly 5 years to maturity with a Yield to Maturity of 3.75% and a coupon of 1.538%