You can invest in either a corporate bond which yield 4.85%, or a municipal bond (of equal risk) which yield 3.43%. Which investment should you choose?

Ignore state income taxes:

A. Your marginal personal tax rate is 35%

B. Your marginal personal tax rate is 14%

Please show your calculation for each investor from (Muni to Corporate bond, and once again, from Corporate to Muni bond equivalent interest rates). In other words,

your calculations will cover two different situations for parts A & again for B; for a total of 4 different sets of calculations.