Which one of the following statements is true in regards to municipal bond insurance? Multiple Choice...

Which one of the following statements is true in regards to municipal bond insurance?

Multiple Choice

The insurance premium is paid by the bondholders.
Insured bonds tend to sell at lower prices than uninsured bonds.
To date, bond insurers have not had to pay any payments for bond defaults.
The insurance can be cancelled with 30 days notice to the bond issuer.
The financial strength of the bond issuer can affect the bond's credit rating.

Solutions

Expert Solution

The financial strength of the bond issuer can affect the bond's credit rating.

Explanation:

In municipal bond insurance premium is paid by the bind issuer and these bonds sell at a higher price to uninsured bonds and bond issuer pay at regular interval to a trust for insurance

jeff jeffy answered 1 year ago

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