SIE practice questionmediumT-bills, T-notes, T-bonds
A customer wants to invest in a U.S. Treasury security with a 10-year maturity and semiannual interest payments. Which should they buy?
- ATreasury note (T-note)✓ Correct answer
- BTreasury bill (T-bill)
- CTreasury bond (T-bond)
- DTreasury Inflation-Protected Security (TIPS)
Explanation
Why A — Treasury note (T-note)
T-notes have maturities from 2-10 years and pay interest semiannually. T-bills are short-term and pay no interest; T-bonds mature in 20-30 years; TIPS are inflation-indexed.
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