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Why are Treasury Securities considered risk free?

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Why are Treasury Securities considered risk free, and what is the impact of default risk on interest rates?

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Treasury securities are considered risk-free due to their unique elements. Treasury securities are also known as T-bills. A T-bill is a short-term security (Issued for one year or less) in varying denominations. They are risk-free because T-bills are issued and backed by the United ...

Solution Summary

This solution explains why treasury securities are considered risk free.