- CFA Exams
- CFA Exam: Level I 2021
- Study Session 15. Fixed Income (2)
- Reading 47. Fundamentals of Credit Analysis
- Subject 6. Special Considerations of High-Yield, Sovereign, and Municipal Analysis
CFA Practice Question
When assessing the credit risk of tax-backed municipal bonds, an analyst should consider the following factors ______.
II. the issuer's budgetary policy
III. flow of funds structure
IV. the issuer's political discipline
I. the issuer's debt structure
II. the issuer's budgetary policy
III. flow of funds structure
IV. the issuer's political discipline
Correct Answer: I, II and IV
III should be evaluated for revenue bonds.
One more factor is the issuer's socio-economic environment.
III should be evaluated for revenue bonds.
User Contributed Comments 2
| User | Comment |
|---|---|
| danlan2 | IV=Local tax and intergouvernmental policy? |
| praj24 | Lol these questions, I just relate to the Greek drama. |