FINRA SIE quiz: General obligation bond issuance

Which of the following would likely be supported by a G.O. bond issuance?

A. Toll roads
B. Mass transit
C. New water treatment facility
D. Beautification of local park

Answer: D. Beautification of local park

General obligation (G.O.) bonds are issued to support projects that lack revenue, but are essential to the municipality. Creation or improvements to parks generally would not create a revenue stream and would need to be supported by property taxes. New water treatment facilities, toll roads, and mass transit systems all have income potential.

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