Revenue bonds can be utilized for which of the following purposes?

Prepare for the Certified Treasury Professional Exam. Dive into flashcards and multiple choice questions, with hints and explanations for each. Ensure your success on the exam!

Revenue bonds are a type of municipal bond that are specifically issued to finance projects that generate revenue, such as toll roads, bridges, and other public infrastructure. The key characteristic of revenue bonds is that they are not backed by the full faith and credit of the issuing municipality. Instead, they rely on the revenue generated by the specific project they finance. This means that the bondholders will be paid back through the revenue produced from the project, making these bonds particularly attractive for funding endeavors that can produce a steady income stream.

In contrast, the other purposes listed do not align with the fundamental function of revenue bonds. Financing general governmental operations usually involves general obligation bonds which are backed by the government's credit and tax revenues. Providing tax subsidies to private entities or securing personal loans fall outside the scope of what revenue bonds are designed to support, as they are more about funding public ventures that will create self-sustaining income streams rather than direct financial aid or private financing.

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