Which of the Following Statements Are True of Treasury Bills

question 10

Multiple Choice

Which of the following statements are true of Treasury bills?

• A) The market for Treasury bills is extremely deep and liquid.
• B) Occasionally, investors find that earnings on T-bills do not compensate them for changes in purchasing power due to inflation.
• C) By volume, most Treasury bills are sold to individuals who submit noncompetitive bids.
• D) All of the above are true.
• E) Only A and B of the above are true.

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Definitions:

Capitalized

To be capitalized means to record an expense as an asset on the balance sheet rather than an immediate expenditure, spreading its impact over its useful life.

Lease Obligations

Financial commitments arising from lease agreements, which may include future lease payments for rented equipment or property.

Coupon Rate

The rate of interest paid yearly on a bond, represented as a percentage of its face value.

Par Value

A nominal or face value assigned to a share of stock or a bond by the issuer.