Currently, a Three-Year Treasury Note Pays 4

question 23

Multiple Choice

Currently, a three-year Treasury note pays 4.75%. Assuming that your tax rate is 20%, what is the minimum interest rate that you would you need to earn on a tax-free municipal bond in order to buy it instead?

• A)0.95%
• B)3.8%
• C)5.7%
• D)15.25%

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Definitions:

Superior Nuchal Line

A ridge on the external surface of the occipital bone of the skull, running horizontally from the external occipital protuberance to the mastoid part of the temporal bone.

Clavicle

A long bone that serves as a strut between the shoulder blade and the sternum or breastbone; also known as the collarbone.

Levator Scapulae

A skeletal muscle located in the back and side of the neck that elevates the scapula.

Phrenic Nerve

A nerve that originates in the neck (C3-C5) and passes down between the lung and heart to reach the diaphragm, crucial for breathing.