Products & Their RisksQuestion 162 of 398
A 'double-barreled' municipal bond is one that is backed by:
a.Two separate insurance companies
b.A federal guarantee plus a state guarantee
c.Two different maturities in the same certificate
d.Both a specific revenue source and the issuer's general taxing power
Explanation
A double-barreled bond combines features of both a revenue bond and a general obligation bond: it is payable first from a defined revenue source, but is also backed by the issuer's full faith and credit and taxing power if that revenue falls short. This dual backing generally makes it safer than a pure revenue bond.
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