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What is the yield on a $30,000 municipal bond with a coupon rate of 9.75%, paying interest annually, versus the yield of a $30,000 corporate bond with a coupon rate of 15% paying interest annually? Assume that you are in the 35% tax bracket.

Select one:

A.

Municipal bond yield is more than after-tax yield of corporate bond.

B.

Municipal bond yield is less than after-tax yield of corporate bond.

C.

Municipal bond yield is the same as the after-tax yield of corporate bond.

D.

The information provided is not enough to calculate the right answ