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At What Point Would an Investor Be Indifferent Between a GM

Question 25

Multiple Choice

At what point would an investor be indifferent between a GM corporate bond yielding 9.5 percent and a tax-free municipal bond of equal financial strength if the investor's marginal tax rate is 25 percent?


A) 7.13%
B) 7.60%
C) 11.87%
D) 12.67%
E) 14.27%

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