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1 FINANCE MCQS

The government issues treasury bills at a discounted rate from which value?

  • Face value
  • Book value
  • Federal value
  • Premium value
Correct Answer: C. Federal value

Detailed Explanation

Treasury bills (T-bills) are short-term government securities that are issued at a price lower than their face value. The difference between the purchase price and the face value represents the investor's return. At maturity, the holder receives the full face value, making T-bills a discount instrument commonly used for risk-free investment.

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