Section 2b U.S. Government Securities

Question 1

Series EE bonds

Answer 1

Safe low risk savings products that earn fixed interest for up to 30 years. Come in denominations for $25 or more up to 10k per social security #. Interest if any is added to the bond monthly and paid when redeemed. U.S. Treasury guarntees that an EE bonds value will double after 20 years. They will earn interest up to 30 years

Question 2

Series I bonds

Answer 2

Issued at face value and offer investors a bond with a fixed rate combined with semiannual inflation adjustments that help protect against purchasing power risk. Issued in denominations ranging from $50 to 10k. Interest income is not paid until the bond is redeemed. Series EE bonds can not be redeemed for series I bonds

Question 3

4 types of Marketable Government Debt are?

Answer 3

1. Treasury bills (t-bills)
2. Treasury notes
3. Treasury bonds
4. TIPS (treasury inflation protected securities)

Question 4

Two types of Non-marketable issues are?

Answer 4

Series EE and Series I savings bonds

Question 5

Treasury Bonds

Answer 5

Treasury Bonds are long term debt issued by the US Treasury at FACE VALUE. T-Bonds pay interest semiannually and mature within 1 to 10 years.

T-Bonds ARE marketable debt.

Question 6

Treasury STRIPS

Answer 6

Treasury STRIPS are stripped treasuries(discounted principal and interest sold separately)

STRIPS are direct issues of the U.S. government and are backed by it’s full faith and credit