Question

Treasury Bills are basically.

• A. An instrument to borrow short term funds
• B. An instrument to borrow long term funds
• C. An instrument of capital market
• D. None of the above

Answer 1

The correct option is A An instrument to borrow short term funds

Treasury Bills are an instrument to borrow short term funds.

Treasury Bills are short term (up to one year) borrowing instruments of the Government of India which enable investors to park their short term surplus funds while reducing their market risk. They are auctioned by Reserve Bank of India at regular intervals and issued at a discount to face value.