Which type of bond is backed by the full faith and credit of the issuer and its entire taxing power?

Question

Quizplus · Accepted Answer

General obligation bonds are backed by the full faith and credit of the issuer, such as a state or municipality, and its entire taxing power. This makes them a secure investment because the issuer has the authority to raise taxes to repay the bondholders if necessary. Fannie Mae and Freddie Mac are government-sponsored enterprises (GSEs) that provide funding for the mortgage market, while revenue bonds are backed by the revenue generated from a specific project or facility.

Which Type of Bond Is Backed by the Full Faith