Which is better: discount or high coupon rate? Type of bond Discount High rate Municipal: not state tax-exempt Municipal: state tax-exempt Treasury security Corporate or other Price you paid (% of face value) % % Face value $ $ Coupon rate % % Months until maturity Your coupon income is: Invested elsewhere at a rate of% Spent Months until you sell bonds Market rate when you sell % Your federal tax rate % Your state tax rate %