Buy corporate bond or muni bond

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Reference no: EM131531297

Duration of Bonds is not needed to answer question. You are a Financial Advisor and you have been asked by a client if they should buy a corporate bond or a Muni Bond. Speaking only to the aspect ofwhat has the best yield advise your client by using the Tax Equivalent Yield calculation given the following:

Corporate Bond Option 1:

AAA JOHNSON & JOHNSON 5.550 08/15/2017

AAA Corporate, Investment Grade, Secondary Fixed Rate Bid/Ask 101.895/101.641

Muni Bond Option 2:

AA1 AA1 FORT LAUDERDALE FLA WTR & SWR 5.000 09/01/2032 09/01/2019

AA+ Municipal, Investment Grade, Secondary Fixed Rate   Bid/Ask 109.830/108.878

Reference no: EM131531297

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