Asked by Aubrey Velele on May 27, 2024
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If federal tax rates increased, what would happen to the interest rate on municipal bonds?
Municipal Bonds
Debt securities issued by states, cities, counties, and other governmental entities to finance public projects, often offering tax-free interest payments to investors.
Federal Tax Rates
The percentages at which income, corporate profits, and other types of earnings are taxed by the federal government.
Interest Rate
The cost of borrowing money or the return on investment, typically expressed as a percentage of the principal amount.
- Understand the factors affecting bond interest rates and risks.
Verified Answer
Learning Objectives
- Understand the factors affecting bond interest rates and risks.
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