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Question No: 8    ( Marks: 1 )    - Please choose one

 Which one of the following is true for the relationship between the yield of taxable and tax exempt bond?

       ► Higher the tax rate wider the gap between the yield of taxable and tax exempt bond

       ► Taxable bond yield is always greater than tax exempt bond

       ► Higher the tax rate shorter the gap between yield of taxable and tax exempt bond

       ► Lower the tax rate wider the gap between yield of taxable and tax exempt bond

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Thanks & Regards

Syed Brothers

MBA Multi Semester Fall 2010

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