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Suppose taxable bonds are currently yielding 8%, while at the same time, municipal bonds of comparable risk and maturity are yielding 6%. Which is more
Suppose taxable bonds are currently yielding 8%, while at the same time, municipal bonds of comparable risk and maturity are yielding 6%. Which is more attractive to an investor in a 40% tax bracket? What is the break-even tax rate? How do you interpret this rate?
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