Your bank has two checking account options, one pays tax-free interest at a rate of 2% per annum and the other pays taxable interest at a rate of 3% per annum. You are currently in a 25% marginal tax bracket. If you converted the tax-free interest rate to the comparable taxable interest rate you would find that:

A. The comparable taxable rate is 2.667%, thus you would select the taxable account B. The Comparable taxable rate is 2.35%, thus you would select the taxable account C. The Comparable taxable rate is 3.53%, thus you would select the tax free account D. You would always select the account bearing the highest interest rate.

Please help me understand why.