4、An investor is considering the purchase of two bonds. One of the bonds is tax-exempt and yields 4.5% while the other bond is taxable and yields 6.0%. If the two bonds are alike in all other characteristics, the marginal tax rate that would make the investor indifferent between the two bonds is closest to:

A. 9.0%.

B. 25.0%.

C. 27.0%.

D. 75.0%.

答案和详解如下：

4、Correct answer is B

"Understanding Yield Spreads," Frank J. Fabozzi

2008 Modular Level I, Vol. 5, pp. 359-361

Study Session 15-65-i

compute the after-tax yield of a taxable security and the tax-equivalent yield of a tax-exempt security

The indifference point would be the tax rate that satisfies the equation: 6.0%(1 - T) = 4.5%. Solving for T, the marginal tax rate = 25%.

谢谢

answer~!

thanks