tax-free vs. taxable yields?

Question

I just don't get this...

With a 28% marginal tax rate, would a tax-free yield of 7% or a taxable yield of 9.5% give you a better return on your savings? Why?

Answer 1

With a marginal tax rate of 28%, you get to keep .72 of the amount. Take .72 times 9.5%, and compare it to 7% to see which is larger. the taxable 9.5% gives an after-tax amount of 6.84, smaller than the 7% tax-free yield.

Answer 2

tax free yield of 7% you get to keep 100% of that. With taxable yield of 9.5% you get to keep 72% of that with a 28% marginal tax rate, which results in an after-tax yield of 6.84%.

By the way, where can I get a tax-free yield of 7%?

Answer 3

residing costs are no longer deductible education costs subsequently quantities won for that is earnings in case you won the $1825 for instructions and paid that, that is a wash