Everything Else Held Constant,if the Tax-Exempt Status of Municipal Bonds

question 88

Multiple Choice

Everything else held constant,if the tax-exempt status of municipal bonds were eliminated,then

• A)the interest rates on municipal bonds would still be less than the interest rate on Treasury bonds.
• B)the interest rate on municipal bonds would equal the rate on Treasury bonds.
• C)the interest rate on municipal bonds would exceed the rate on Treasury bonds.
• D)the interest rates on municipal,Treasury,and corporate bonds would all increase.

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