A municipal bond fund:

Question

Quizplus · Accepted Answer

A municipal bond fund invests in municipal bonds issued by state and local governments, which are considered relatively safe investments. While there is some risk involved, it is not considered too risky for most investors. Therefore, option B is the most appropriate answer. Option C is incorrect because municipal bonds are not backed by the federal government. Option D is incorrect because no investment can be considered fully risk-free. Option E is incorrect because a municipal bond fund does not invest solely in Treasury bonds.

A Municipal Bond Fund