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Municipal bonds are a type of debt security issued by state and local governments to finance various public projects such as building schools, roads, and water treatment plants. Investors who buy these bonds are essentially lending money to the government in exchange for regular interest payments and the return of the original investment at maturity. Municipal bonds are considered to be relatively safe investments, as they are backed by the taxing power of the issuing government. However, it's important to remember that the value of municipal bonds can fluctuate depending on factors such as changes in interest rates and the financial stability of the issuing government.

 

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