Question
How does a general obligation bond differ from a revenue bond in credit support?
Tap to flip
Answer
GO bonds use full taxing power; revenue bonds rely on project revenues.
Tap to flip back
Question
A sovereign improves reserve adequacy and lowers its fiscal deficit. What is the likely credit trend?
Tap to flip
Answer
Improving sovereign credit profile.
Tap to flip back
Question
A country becomes more politically unstable after an election dispute. What is the likely credit implication for its sovereign bonds?
Tap to flip
Answer
Higher sovereign risk due to reduced willingness or ability to repay.
Tap to flip back
Question
If a sovereign's debt-to-GDP ratio rises sharply, what does that usually signal about credit quality?
Tap to flip
Answer
Deteriorating credit quality; higher debt burden worsens risk.
Tap to flip back