Question: Emily is comparing two bonds that she is thinking about purchasing. One is a municipal bond issued by her home state with a 4% yield

Emily is comparing two bonds that she is thinking about purchasing. One is a municipal bond issued by her home state with a 4% yield that would be free from both federal and state taxation. Emily is in the 25% federal tax bracket and the 5% state tax bracket. What would a fully-taxable corporate bond have to yield in order to produce the same after-tax return as the 4% municipal bond? Show work including intermediate steps.
Express your answer as a percentage rounded to two decimal places.

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