Terrence lives in a state that has suffered years of economic decline.

QUESTION

Terrence lives in a state that has suffered years of economic decline. He wants to support the state’s effort to rebuild by purchasing a variety of municipal bonds for his portfolio. He also wants diversity in bond payout options.

What type of bond does NOT fit Terrence’s investment strategy?
A) convertible bonds
B) callable bonds
C) serial bonds
D) revenue bonds
E) sinking-fund bonds

ANSWER

Answer: A
Explanation: A) Convertible bonds can only be issued by corporations; they cannot be issued by governments.