Characteristics of Government Bonds

Very Easy Fixed Income Securities Bond Markets

In bond markets, different types of bonds have different characteristics that investors need to understand. One common type of bond is the government bond, which is issued by national governments. Government bonds are often considered lower-risk investments due to the backing of the government's credit.

Which of the following statements accurately describes government bonds?

Government bonds typically offer higher yields than corporate bonds.

Government bonds are generally considered riskier than municipal bonds.

Government bonds are backed by the full faith and credit of the issuing government.

Hint

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