📢 Too many exams? Don’t know which one suits you best? Book Your Free Expert 👉 call Now!

    âš¡ Month End Offer - Flat 52% Off On All Courses! Enroll Now âš¡
    00:00:00 AM Left

    Question

    Which one of the following is/are True about the

    difference between Bonds and Treasury Bills? I- maturities less than 1 year are called T-bills and those more than one year are called bonds. II- T-bills are issued at a discount to their true (PAR) value and upon expiry, its redeemed at its true value. III- T-bills can’t be bought by Individuals.
    A Only I Correct Answer Incorrect Answer
    B Only II Correct Answer Incorrect Answer
    C I & II Correct Answer Incorrect Answer
    D II & III Correct Answer Incorrect Answer
    E All of the above Correct Answer Incorrect Answer

    Solution

    G-Secs is a collective term for these two types of securities: maturities less than 1 year are called T-bills and those more than one year are called bonds. There are three T-bills variants and they vary based on the maturity period. They are 91 days, 182 days, and 364 days. T-bills do not carry an interest component, in fact, this is one of the biggest differences between T-bills and Bonds. T-bills are issued at a discount to their true (PAR) value and upon expiry, its redeemed at its true value.

    Practice Next
    More Capital Market Questions
    ask-question