Susan Adams’s marginal tax rate is 25 percent. She is contemplating the purchase of either a corporate bond that has a 3.5 percent coupon or a newly issued tax-exempt municipal bond paying2.5 percent. What is Susan’s taxable equivalent yield if she were to purchase the tax-exempt municipal bond?

A. 1.9125.

B.2.5000.

C.3.3333.

D.3.5000.