Mantle Corporation Is Considering Two Equally Risky Investments: A $\$ 5,000$

Multiple Choice

Mantle Corporation is considering two equally risky investments: A $\$ 5,000$ investment in preferred stock that yields $6.75 \%$ .
A $\$ 5,000$ investment in a corporate bond that yields $10.00 \%$ .
What is the breakeven corporate tax rate that makes the company indifferent between the two investments? Assume a 70.00% dividend exclusion for tax on dividends.(Do not round your intermediate answer and round your final answer to two decimal places. )

A) 46.87%
B) 34.23%
C) 37.08%
D) 40.75%
E) 50.13%