The taxpayer's marginal federal and state tax rate is $37\%.$ Which would the taxpayer prefer?

a$.$

$$1\mathrm{.}65$ taxable income rather than $$1\mathrm{.}00$ tax$-$exempt income

b$.$

$$1\mathrm{.}00$ taxable income rathen than $$1\mathrm{.}37$ tax$-$exempt income

c$.$

$$1\mathrm{.}37$ taxable income rather than $$1\mathrm{.}00$ tax$-$exempt income.

d$.$

$$1\mathrm{.}00$ taxable income rather than $$\mathrm{.}63$ tax$-$exempt income.

e$.$

The taxpayer would prefer none of the choices shown.