Business, 08.10.2019 00:00 lilytimpsonx

Ms. z has decided to invest $75,000 in state bonds. she could invest in state a bonds paying 5 percent annual interest or in state r bonds paying 5.4 percent annual interest. the bonds have same risk , the interest from both is exempt from federal income tax. because ms. z is a resident of state a , she would not pay state a's 8.5 percent personal income tax on the state a bond interest, but she would pay this tax on the state r bond interest .ms. z can deduct any state tax payments in the computations of her federal taxable income , and her federal marginal rate is 33 percent. should ms. z invest in the state a or state r bonds?

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Ms. z has decided to invest $75,000 in state bonds. she could invest in state a bonds paying 5 perce...