Interest on Bonds Issued by State and Local Governments with Good

question 80

Multiple Choice

Interest on bonds issued by state and local governments with good credit ratings

• A)is not subject to federal income tax and so these bonds have a higher interest rate than otherwise comparable bonds issued by the U.S.government.
• B)is not subject to federal income tax and so these bonds have a lower interest rate than otherwise comparable bonds issued by the U.S.government.
• C)is subject to federal income tax and so these bonds have a higher interest rate than otherwise comparable bond issued by the U.S.government.
• D)is subject to federal income tax and so these bonds have a lower interest rate than otherwise comparable bond issued by the U.S.government.

---

Definitions:

High-Growth Asian Economies

Asian countries that have experienced significant and rapid economic growth, typically through industrialization.

Federal Expenditures

Government spending or outlays, funded by tax collections and other revenues, on programs, projects, and activities.

Income Transfers

Payments made by the government to individuals without any expectation of goods or services being provided in return, aimed at redistributing wealth and reducing poverty.

National Defense

Governmental and military measures designed to protect a country from external aggression and threats.