assume you are in the 35 percent tax bracket and purchase a 4.80 percent tax - emempt municipal bond. calculate the taxable equivalent yield for this investment.
(See answer below)
7.38% is the taxable equivalent yield for this investment. since Tax-Equivalent Yield = Tax-Free Interest Rate ÷ (1 – tax rate)//N= 4.80 divide by (1 - 0.35) ...
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