Municipal bonds are issued by state and local governments, U.S. territories, and non-federal public agencies such as school districts, cities, and airport authorities. Municipal debt is considered the second safest form of debt security after U.S. government obligations. Some types of municipal bonds include all of the following EXCEPT:
Answer(s): C
These are the most common type of municipal bonds and are backed by projected revenue streams from the infrastructure built by the bond. These revenues can be in the form of rental or user fees for facilities or even tolls for road improvements. What are these?
Answer(s): D
Negotiable certificates are:
Answer(s): B
As interest rate change, the price of an issued bond also changes. The change in price has an inverse relationship to changes in interest rates (if one rises, the other falls). If new bond issues are paying a higher interest rate than existing bonds, investors will not purchase existing bonds unless:
Answer(s): A
Banks should develop policies related to ALM, including specific guidelines regarding risk/reward tradeoffs. The goal is to manage risks while achieving acceptable returns on investments. In developing these policies bank officials analyze:
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