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S. Townsend Incorporated is considering two equally risky investments: 1. A $25,000 investment in a municipal bond that yields 5.65 percent 2. A $125,000 investment
S. Townsend Incorporated is considering two equally risky investments:
1. A $25,000 investment in a municipal bond that yields 5.65 percent
2. A $125,000 investment in a preferred stock that yields 6.1 percent
What is the break-even corporate tax rate that makes the company indifferent between the two investments
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