Short-term government debts issued in denominations ranging from $1,000 to $1 million. Like many other cash-based investment vehicles, T-Bills do not pay interest but are sold at a discount and mature at par (100 per cent of face value). The difference between the purchase price and par at maturity represents the purchaser’s return, and is taxed as interest income.
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Term of the Minute
- Bid
The highest price a prospective buyer is willing to pay for a particular security.