Question: Is Folk music always acoustic?
Answer: No. Ever since Bob Dylan went electric (much to many people's dismay) at the 1965 Newport Folk Festival, an entire movement of folk-rock has evolved. Folk rock and alt.country artists regularly use electric guitars and bass. Often these genres are peopled with folks who don't look a whole lot different from your typical rock and roll band.
Singer/Songwriters like Suzanne Vega, Billy Bragg, and Ani Difranco have often experimented with different types of electronic styles. Folk artists often employ guitar peddles and other electronic effects as well.

