Which of the following credit analysis factors is more important for a general obligation non-sovereign government debt when compared to sovereign debt?

A. Per capita income.
B. Tax collection performance.
C. The obligation to balance the operating budget.

Correct Answer: C

Non-sovereign governments are not able to utilize monetary policy and typically must balance their operating budgets. This obligation makes it an important criterion for analysts when selecting choosing between non-sovereign government debt and sovereign debt.