State tax bracket and inflation is expected

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Determine the nominal rate you would have to be paid on a 15-year municipal bond to be indifferent between it and a 15-year corporate bond if the corporate bond has a nominal 6.28% yield. Assume you are in a 39.6% federal and 8.7% state tax bracket and inflation is expected to be 1.75%.

Reference no: EM13887803

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State tax bracket and inflation is expected : Determine the nominal rate you would have to be paid on a 15-year municipal bond to be indifferent between it and a 15-year corporate bond if the corporate bond has a nominal 6.28% yield. Assume you are in a 39.6% federal and 8.7% state tax bracket a..

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