Stephanie, a Taxpayer in the 24% Marginal Tax Bracket, Borrows

question 67

Multiple Choice

Stephanie, a taxpayer in the 24% marginal tax bracket, borrows $100,000 at 7% interest to invest in 6% tax-exempt municipal bonds (annual loan interest expense is $7,000) .What is Stephanie's interest expense deduction?

• A)$0
• B)$1,000
• C)$6,000
• D)$7,000

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