Would you suggest they invest in municipal bonds


Problem

Make some comparisons regarding the yield of certain bonds given the following tax information: Assume municipal bonds (which are not subject to federal income tax) yield 5%. Given an individual with a marginal tax rate of 35%, would you suggest they invest in municipal bonds or Federated bonds (so which bonds would provide them with a greater relative yield)?

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Taxation: Would you suggest they invest in municipal bonds
Reference No:- TGS03329020

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