CFA Practice Question

There are 266 practice questions for this study session.

CFA Practice Question

When analyzing the creditworthiness of tax-backed municipal bonds, which of the following factors would be of least importance?
A. political history of the jurisdiction
B. the composition of the jurisdiction's tax base
C. the sources of revenue for the jurisdiction that will be earmarked to service these bonds
Explanation: Tax-backed bonds are also referred to as general obligation bonds, which means that the bonds are serviced out of the general tax revenues collected by the issuing jurisdiction. This being the case, there is no distinction among sources used to meet these bond obligations.

User Contributed Comments 4

User Comment
MonkeySee Reading question: "Tax-backed!!!! Municipal Bonds"
yxten1 And how important is the political history of the juristiction?
soorajiyer yxten1, absolutely! Political history?? I think that choice is just not correct too!!
Vedo well i work with municipals and there are bonds which are backed by SPECIFIC TAX, and are not GO's, for these bons it is very important where the taxes are coming from.
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