Final answer:
During financial crises, governments may face challenges repaying bondholders due to deficits and investor confidence issues.
Explanation:
In times of financial crisis, governments may indeed struggle to repay bond holders in a timely manner. This can occur when a government's expenditures exceed its revenue, leading to deficits that must be financed through borrowing. If investors lose confidence in a government's ability to repay its debt, they may demand higher interest rates or refuse to purchase government bonds, potentially leading to defaults.
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