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Bonds 108: Introduction to Government Bonds

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1.
Why were collateralized mortgage obligations introduced to the market?
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To reduce the prepayment risks that arise from refinanced mortgages. Investors can reduce their risks by choosing different maturities to invest in.
2.
Treasury bond maturities can last as long as ________ years.
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Thirty. Thirty years is the maximum maturity.
3.
Treasury notes are sold through auctions.
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True. They are sold this way, using bids.
4.
Many investors consider government bonds the safest of all bonds because _______.
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They are backed by the credit of the US government. The US government is considered to have the best ability to repay bonds and bond interest.
5.
What is the range of maturities of agency bonds?
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One to fifty years. Agency bonds have a very wide range.
6.
________ are redeemed by the US government rather than sold on exchanges.
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Non-marketable US bonds. They are called "non-marketable" because they cannot be sold on markets, and exchanges are markets.