The City of Austin offers annual municipal bonds that pay 4.5% interest tax free. Texas Instruments offers annual bonds that pay 7.5% interest (taxable). The S&P ratings on both concerns are the same, so that there is no difference in default risk between the two bonds of equal maturity. Assuming that the investor is a wealth optimizer (he chooses the bond with the highest after-tax rate of return), what rate of return will the investor secure on his preferred bond if his marginal tax rate is 38%.