What are self-supporting and general obligation bonds? For what are they typically used in Texas? Why are such bonds necessary in Texas, and is there any problem with their use?
What will be an ideal response?
Answer: An ideal response will:
1. Define self-supporting and general obligation bonds.
2. Explain that bonds are typically used to fund capital projects, particularly general obligation bonds.
3. Explain that the prohibition against deficit financing in the Texas Constitution makes bond funding essential for some major projects.
4. Explain that the use of general obligation bonds increases project costs because of interest payments and that debt represents a tax liability for future taxpayers.
You might also like to view...
Based on the logic of the balance of power, which of the following is a good example of an alliance that can be said to be currently balancing the United States?
A) The North Atlantic Treaty Organization (NATO) B) The European Union (EU) C) The North American Free Trade Agreement (NAFTA) D) The United Nations (UN)
In the late 1790s the Federalist Party had, among other things, sought to build an alliance with Britain. The Anti-Federalists were distrustful of Britain, especially in light of the war we had just fought. Instead the Anti-Federalists sought alliance and favorable relations with which country?
a. Germany b. Japan c. Canada d. France e. South Africa