Question

____________ is also called zero coupon bond.
(a) Trade bills
(b) Call money
(c) Treasury bills
(d) Commercial papers

Answer 1

Treasury bill is also called zero coupon bond.

Treasury Bill : Treasury bills are the instrument money market instruments, short term loan instrument issued by the Government of India . These are Government bonds or loan securities with maturity of less than a year. They are also called zero coupon bond and pay zero interest. They are issued at face value and redeemed at the face value.

Answer 2

Treasury bills are also called zero-coupon bonds.

• A zero-coupon bond is also known as an accrual bond.
• It is a very special kind of debt security that does not pay interest to the investors. It gives a discount to the investors who can purchase these bonds at a very low price and then cancel them when the bond is redeemable for its full face value.
• These bills do not make periodic interest payments and thus are called zero-coupon bonds.