When the National Government Requires States or Localities to Undertake

question 34

Multiple Choice

When the national government requires states or localities to undertake a specific activity or provide a particular service but does not pay for it, this is referred to as

• A)a project grant.
• B)an unfunded federal mandate.
• C)a revenue sharing provision.
• D)an unfunded categorical grant.

Understand and calculate the tax implications for earnings from different types of bonds, including zero-coupon and coupon-bearing bonds.

Analyze the relationship between bond prices and yields, including the effects of yield to maturity on bond pricing.

Estimate the credit risk premium on corporate bonds in comparison to treasury bonds based on their yield to maturity and price.

Understand the concept of sovereign default and identify historical instances of such defaults.