Three

friendsNeelam,

Ashok,

and

Madhuhave

asked you to determine the equivalent taxable yield on a municipal bond. The bond's current yield is

6.33

percent with 5 years left until maturity.

Neelam

is in the

15

percent marginal tax bracket,

Ashok

is in the

25

percent bracket, and

Madhu

is in the

35

percent bracket. Calculate the equivalent taxable yield for your three friends. Assuming a similar AAA corporate bond yields

7.00

percent, which of your friends should purchase the municipal bond?

Question content area bottom

Part 1

The equivalent taxable yield for

Neelam

who has a

15

percent marginal tax bracket is

enter your response here%.

(Round to two decimal places.)