The three main types of banks (Traditional, Credit Union, Online or Online-Only) have many tradeoffs with respect to technology,
convenience, personal experience, fees and savings rates. For this question, put aside all of the trade-offs and look only at savings rate offered on savings accounts. Rank the following from highest to lowest on the interest rates they offer to consumers on savings accounts. A)Credit Union, Traditional Bank, Online Bank
B)Online Bank, Credit Union, Traditional Bank
C)Credit Union, Online Bank, Traditional Bank
D)Traditional Bank, Credit Union, Online Bank
I think the answer would be : B. Online Bank, Credit Union, Traditional Bank
Online bank offer around 1.05 % interest rates and credit Union is only a little bit below that. While traditional banks only offer around 0.01 % of interest rates
Municipal bonds are tax exempt and so are attractive for this reason. If John is to be indifferent between the two, the corporate bond would have to offer a return that when adjusted for tax, will give the same return as the municipal bond.
