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12 September, 00:59

A client in the 33 percent marginal tax bracket is comparing a municipal bond that offers a 5 percent yield to maturity and a similar-risk corporate bond that offers a 6.25 percent yield. Which bond will give the client more profit after taxes

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  1. 12 September, 01:01
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    The municipal bond

    Explanation:

    5%/1-.33 = 7.46

    1.7.46>6.25, so the client should take the municipal bond
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