If interest rates are expected to rise, a prudent strategy would be to sell treasury bills and buy treasury bonds.

Question

Quizplus · Accepted Answer

When interest rates are expected to rise, it's generally more prudent to buy shorter-term securities like Treasury bills, not sell them, because their prices are less sensitive to interest rate changes compared to longer-term securities like Treasury bonds, which typically decrease in value when interest rates rise.

If Interest Rates Are Expected to Rise, a Prudent Strategy