Weighing the Choice between Taxable and Tax-Free Bonds
1, then multiplying the taxable bond's yield by the result. (To see how to calculate the taxable equivalent of a tax-free bond, see "When Less Is More.") If a taxable bond also is subject to state and local taxes and the tax-exempt one isn't, the tax-exempt bond's coupon rate could be even lower and still provide a higher tax-equivalent yield ... ................
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