Treasury notes and bonds are issued in denominations of?

Treasury notes and bonds are issued in denominations of?

• A. From $1,000 to $100,000
• B. From $500 to $50,000
• C. From $100 to $1,000
• D. From $10,000 to $1,000,000

Answer: (A)

Denomination is the face value of the security at issue and the amount used to calculate coupon payments. For Treasury notes and bonds, the standard issue size is $1,000, and they are sold in blocks that are multiples of that amount. In practice, buyers often transact in $1,000 lots, and institutional purchasers can deal in larger blocks up to about $100,000 for a single transaction. That combination is why the common range you see stated is from $1,000 to $100,000. The coupon payments and the price you see in quotations are based on that par value, so knowing the denomination tells you how much money you’re actually investing and what cash flows to expect.

Denomination is the face value of the security at issue and the amount used to calculate coupon payments. For Treasury notes and bonds, the standard issue size is $1,000, and they are sold in blocks that are multiples of that amount. In practice, buyers often transact in $1,000 lots, and institutional purchasers can deal in larger blocks up to about $100,000 for a single transaction. That combination is why the common range you see stated is from $1,000 to $100,000. The coupon payments and the price you see in quotations are based on that par value, so knowing the denomination tells you how much money you’re actually investing and what cash flows to expect.