Government Bonds

Question 1

Bonds=

Treasury Bonds =

Considered to have NO

Interest payments EXEMPT FROM

Answer 1

Debt

SAFEST BONDS

default risk

STATE and LOCAL taxes

Question 2

T-BILLs (Treasury Bills)

Answer 2

Bought at DISCOUNT
NO coupon payments 
Sold in increments of $100
MATURE in less than 1 YEAR
BUY from TREASURYDIRECT, BANK, or BROKER

Question 3

T-NOTEs (treasury notes)

Answer 3

MATURITIES OF 2-10 YEARS

PAY SEMI- ANNUALLY with
interest (coupon) payments

SOLD in $100 increments

NON-CALLABLE

BUY from TREASURYDIRECT,BANK, or Broker

Question 4

T-BONDs (treasury bonds)

Answer 4

30 YEAR MATURITY

CALLED THE “LONG BOND”

SEMI ANNUAL INTEREST PAYMENTS

NON- CALLABLE