Collection of municipal bonds and corporate bonds

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Reference no: EM131025485

Determine if true, false, or uncertain and briefly explain why.

“Assume you have a collection of municipal bonds and corporate bonds of similar maturities and default risk (i.e. both sets of bonds carry a rating of “AA+” from Standard and Poor’s). Accordingly, a yield curve formed from municipal bonds will be higher than a yield curve formed from the corporate bonds because of their tax-advantaged status.

Reference no: EM131025485

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