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If a Fully-Taxable Bond Yields a BTROR of 8% (Rb

Question 61

Multiple Choice

If a fully-taxable bond yields a BTROR of 8% (Rb = 8%) and a tax-exempt bond of similar risk earns a BTROR of 5% (Rf = 5%) ,then the implicit tax is


A) 3%.
B) 5%.
C) 8%.
D) none of the above.

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