SIE practice questionmediumSTRIPS
What is a characteristic of a Treasury STRIPS?
- AThey pay semiannual interest
- BThey provide periodic principal repayments
- CThey are sold at a discount and mature at par✓ Correct answer
- DThey are issued by corporations
Explanation
Why C — They are sold at a discount and mature at par
Treasury STRIPS are zero-coupon securities sold at a discount and mature at par. They do not make periodic payments and are issued by the U.S. Treasury, not corporations.
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