Morgan,a Financial Advisor,has Told Her Clients the Following Things

question 24

Multiple Choice

Morgan,a financial advisor,has told her clients the following things.Which of her statements is not correct?

• A)"U.S.government bonds generally pay a higher rate of interest than corporate bonds."
• B)"The interest received on corporate bonds is taxable."
• C)"U.S.government bonds have the lowest default risk."
• D)"If you purchase a municipal bond,you can sell it before it matures."

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Definitions:

Exercise Option

The act of implementing the right to buy or sell an asset under the terms of an option contract.

Purchase

The act of buying goods, services, or assets.

Liquidate

To convert assets into cash or to settle debts by selling off assets.

Scanlon Plan

A type of gainsharing program where employees share in financial gains through productivity improvements.