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Bonds 103: Buying Bonds

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1.
A discount bond _______.
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Sells below face value. When its price is below its face value, it is known as a discount bond.
2.
US Treasury bonds bought over the counter have no transaction costs.
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False. Treasury bonds bought over the counter may have a small, additional flat fee.
3.
Bonds in a unit investment trust remain fixed for the life of the trust.
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True. The bonds in the trust remain fixed.
4.
The highest credit rating a bond can receive is _______.
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AAA. AAA is the highest credit mark a bond can receive.
5.
New US Treasury bonds are offered only four times a year.
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True. You can only buy bonds directly from the Federal Reserve during the first half of February, May, August, and November.