Income Beginner: Introduction to Government Bonds

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1.
Government bonds can mature in as many as _______ years.
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Fifty. Government bonds can actually last fifty years.
2.
What is the range of maturities of agency bonds?
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One to fifty years. Agency bonds have a very wide range.
3.
How do Treasury notes differ from Treasury bonds?
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Their maturities. Their maturities last from one to ten years, while those of Treasury bonds last longer than ten years.
4.
Treasury bond maturities can last as long as ________ years.
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Thirty. Thirty years is the maximum maturity.
5.
On _______bonds, the owner can defer taxes on interest until the bond is redeemed.
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Series EE. The owner can pay taxes annually or defer taxes on interest until the bond is redeemed.
6.
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.