Question: Compare a pretax $10,000 sum placed in bonds yielding 6 percent in a qualified pension with an investment in a municipal bond yielding 5 percent.

Compare a pretax $10,000 sum placed in bonds yielding 6 percent in a qualified pension with an investment in a municipal bond yielding 5 percent. The municipal bond sum deposited was made with after-tax dollars on the same pretax $10,000. The marginal tax rate was 32 percent. Assume that the sums were accumulated for 25 years and the pension was liquidated at that time?

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