A consol is a type of perpetuity, which means it pays periodic interest payments forever, without any maturity date. This type of bond is not issued by the U.S. Treasury and is not necessarily a zero-coupon bond or have a maturity exceeding 10 years.

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A Consol Is

Question 8

Multiple Choice

A consol is:

A) another name for a zero-coupon bond.
B) a bond with a maturity date exceeding 10 years.
C) a bond that makes periodic interest payments forever.
D) a form of a bond that is issued quite often by the U.S. Treasury.

Correct Answer: