2.11. U.S. Treasury Securities Flashcards
The United States government, and its various agencies, is the world’s largest _______
Debtor
Yields on Treasury securities are ____than those of corporate bonds, but Treasury securities are ____and offer ____benefits.
Lower, safer, tax
The U.S. Treasury regularly holds auctions of Treasury bills, notes, and bonds at the ____________________________
Federal Reserve Bank of New York
Treasuery securities are used to ______the U.S. government.
Finance
Who buys the treasury securities?
primary dealers, individual investors
Who is a primary dealer?
A primary dealer is a bank or broker-dealer that buys the treasury securities at the auction and resells them to the investors
Primary dealers serve as __________ for the majority of U.S. Treasury securities.
market makers
Interest on all Treasury securities is taxable at the ________level, but exempt from_______
Federal, state and local taxes
What is a Treasury Bill?
T-Bill is a treasury security that matures in one year or less
What is the maturity date for a T-Bill?
Maturity is the date when a debt security terminates and the investor is repaid
T-bills are sold in denominations of _____
$100 up to $5million
What are the common maturity intervals for T-bills?
1 month, 3 months, 6 months and a year
Treasury bills are issued at a _____ and redeemed at ___ value upon maturity
discount, par
How is the interest paid on T-bills?
They do not issue periodic interest payments, instead the interest is included with the repayment of the principal at maturity
T-bills are exempt from _________
state and local taxes
