1. Financial market participants who provide funds are called:
a. deficit units.
b. surplus units.
c. primary units.
d. secondary units.
2. A firm in the 35 percent tax bracket is aware of a tax-exempt security that is paying a yield of 7 percent. To match this yield, taxable securities must offer a before-tax yield of:
a. 7.0%.
b. 10.8%.
c. 20.0%.
d. none of the above