The Advantages of Treasury Bonds Include

question 68

Multiple Choice

The advantages of Treasury bonds include

• A) there is no default.
• B) they can't be called in.
• C) most interest is free of state and local taxes.
• D) All of the above
• E) Only A and C

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Definitions:

Fixed Costs

Costs that do not change with the level of output or sales, such as rent, salaries, and insurance premiums.

Cash Break-even Point

The point at which a business's cash inflows equal its cash outflows, excluding financing.

Degree of Operating Leverage

A ratio that quantifies the sensitivity of a company's operating income to its sales, demonstrating the impact of fixed and variable costs on profitability.

Fixed Costs

Fixed costs that stay the same no matter how much is manufactured or sold, including expenses for rent, employee salaries, and insurance charges.