Question

Treasury bills are _______.

• A. long term liability of State Government
• B. long term liability of Central Government
• C. short term liability of Central Government
• D. joint liability of State and Central Government

Answer 1

Answer: (C)

short term liability of Central Government

Treasury bills are government bills which are offered to the general public by the government to raise short term funds. The market in which buying and selling of treasury bills prevails is known as treasury bills market. Therefore, these are also known as short term liability of central government because the government is liable to repay the face value of the bill on the maturity date.