All Courses > Bonds > 200
Bonds 208: General Obligation Bonds

Test your knowledge

Choose wisely. There is only one correct answer to each question.

0%
Keep studying!
Review your answers below to learn more.
1.
Most general obligation bonds are purchased directly from municipalities.
Choose wisely. There is only one correct answer.
False. Most general obligation bonds are purchased on the secondary market.
2.
General obligation bonds are typically considered a safe investment because ________.
Choose wisely. There is only one correct answer.
Municipalities can raise taxes to avoid default. This typically gives them high credit ratings.
3.
Municipalities may repay bondholders prior to the maturity of the municipal bonds.
Choose wisely. There is only one correct answer.
True. Municipalities may call a bond issue in order to refinance the debt at lower interest rates.
4.
All of the following might be funded with general obligation bonds except _______.
Choose wisely. There is only one correct answer.
A pay parking ramp. This would generate revenue from user fees and would more likely be funded with revenue bonds than GO bonds.
5.
All of the following are ways to make a $1,000 investment in general obligation bonds except _______.
Choose wisely. There is only one correct answer.
Brokers. Brokers typically require minimums of greater than $5,000 to purchase general obligation bonds. The other options are general obligation bond pools that provide a much lower buy-in price.