Treasury Bills

question 4

Multiple Choice

Treasury bills

• A)have a maturity of up to five years.
• B)have an active secondary market.
• C)are commonly sold at par value.
• D)commonly offer coupon payments.

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Definitions:

Yield To Maturity

The total return anticipated on a bond if it is held until the date it matures, including all payments of interest and principal.

5-Year Bond

A debt security issued by governments or corporations with a fixed interest rate and maturity period of five years.

Forward Rate

The future interest rate agreed upon in a forward contract, relating to loans, bonds, or deposits to be made at a specified future time.

Yield To Maturity

The total return expected on a bond if held until its maturity date, considering all interest payments and the principal repayment.