Income Beginner: Bonds and Money Market Investments

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1.
Agencies of the US government sell their own bonds.
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True. To finance their activities, they sell bonds to the public.
2.
Generally, the longer the maturity on a CD, the higher the interest rate.
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True. High interest rates are a way of rewarding investors for leaving their money invested for long periods.
3.
What is sold on the money market?
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Short-term debt securities. Money market investments are short-term. That is their distinguishing feature.
4.
Zero coupon bonds do not pay periodic interest to their owners.
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True. They lack "coupons," or periodic interest payments.
5.
Which of the following does not sell municipal bonds?
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The federal government. Municipalities are state, county, or city levels of government.
6.
One advantage of savings bonds is _______.
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The small minimum purchase required. You can buy savings bonds in amounts as low as $25.