Treasury bills are considered low-risk investments, but they do not necessarily outperform inflation every year. However, over the long term, they have historically outperformed inflation, as seen in the period from 1957-2005.

Solved

Treasury Bills

Question 253

Multiple Choice

Treasury bills:

A) Are considered risk-free as they match or outperform inflation every year.
B) Usually generate a higher rate of return than long-term government bonds.
C) Outperformed inflation on an annual basis for every year during the period of 1957-2005.
D) Always yield an annual rate of return between 1 and 6%.
E) Outperformed inflation over the long-term as seen in the historical record for 1957-2005.

Correct Answer: