Which of the following statement(s) is (are) true regarding municipal bonds?I) A municipal bond is a debt obligation issued by state or local governments.II) A municipal bond is a debt obligation issued by the federal government.III) The interest income from a municipal bond is exempt from federal income taxation.IV) The interest income from a municipal bond is exempt from state and local taxation in the issuing state.
A) I and II only
B) I and III only
C) I, II, and III only
D) I, III, and IV only
E) I and IV only

Question

Quizplus · Accepted Answer

Municipal bonds are issued by state or local governments (I), not the federal government (II). The interest income from these bonds is typically exempt from federal income taxes (III), and often exempt from state and local taxes in the issuing state (IV).

Which of the Following Statement(s) Is (Are) True Regarding Municipal