Insured municipal bond bears a lower cost to borrower

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Reference no: EM131084562

An insured municipal bond bears a lower cost to the borrower than does an equivalent uninsured bond because:

a. interest from the insured bond is exempt from federal income tax.

b. the insurer pledges its resources to payment of debt service if necessary.

c. only highest rated (AAA) bonds can obtain insurance.

d. term structures of interest rates vary.

Reference no: EM131084562

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