Which two of the following are the principle means by which a municipality can avoid a lump-sum principal repayment on a single maturity date?
I. issue only zero-coupon bonds
II. issue serial bonds
III. issue term bonds with a sinking fund provision
IV. issue only variable-rate notes

Question

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The principle means by which a municipality can avoid a lump-sum principal repayment on a single maturity date are issuing serial bonds and term bonds with a sinking fund provision. Serial bonds are issued with staggered maturities over a period of time, reducing the principal payment burden on a single maturity date, while bonds with sinking funds require the issuer to make regular contributions to a separate fund which will be used to retire the bonds on the maturity date. Zero-coupon bonds and variable-rate notes do not necessarily provide any relief from a lump-sum principal repayment on a single maturity date.

Which Two of the Following Are the Principle Means by Which