1. Suppose a municipal bond offers a yield to maturity of 5% and a same-maturity corporate bond offers a 4% yield. For which values of the marginal tax rate, an investor would prefer to buy the corporate bond? 
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3. A. The investor would prefer to buy the corporate bond if she faces a marginal tax rate greater than 40%. 
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5. B. The investor would prefer to buy the corporate bond if she faces a marginal tax rate lower than 20%. 
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7. C. The investor would prefer to buy the corporate bond if she faces a marginal tax rate greater than 20%. 
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9. D. The investor would prefer to buy the corporate bond if she faces a marginal tax rate lower than 40%.

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