Which investment will give paul the higher annual earnings, Finance Basics

Which investment will give paul the higher annual earnings

Problem

Annual Interest. Paul has $3,000 that he wishes to invest in bonds. He can purchase Treasury bonds with a coupon rate of 7.4% or municipal bonds with a coupon rate of 6.5%. Paul lives in a state with no state income tax and has a marginal tax rate of 22%. Which investment will give Paul the higher annual earnings after taxes are considered?

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Finance Basics: Which investment will give paul the higher annual earnings

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