Because of differences in tax treatment, municipal bonds pay a higher interest rate than do corporate bonds.

Name: Because of differences in tax treatment, municipal bonds pay a higher interest rate than do corporate bonds.
Brand: Quizplus
Rating: 4.9 (34 reviews)

Question

Quizplus · Accepted Answer

Municipal bonds typically pay a lower interest rate than corporate bonds because the interest income from municipal bonds is often exempt from federal income taxes and sometimes from state and local taxes as well, making them more attractive to investors despite the lower rate.

Because of Differences in Tax Treatment, Municipal Bonds Pay a Higher