Why may the corporate bond be preferred


An investor in the 35 percent tax bracket may purchase a corporate bond that is rated double A and is traded on the New York Stock Exchange (the bond division). This bond yields 9.0 percent. The investor may also buy a double-A-rated municipal bond with a 5.85 percent yield. Why may the corporate bond be preferred? (Assume that the terms of the bonds are the same.)

Request for Solution File

Ask an Expert for Answer!!
Finance Basics: Why may the corporate bond be preferred
Reference No:- TGS0724417

Expected delivery within 24 Hours