Question

    In India, Treasury bills (T-bills) are auctioned by

    _____
    A Ministry of Finance Correct Answer Incorrect Answer
    B RBI Correct Answer Incorrect Answer
    C SEBI Correct Answer Incorrect Answer
    D SIDBI Correct Answer Incorrect Answer
    E Respective State Government Correct Answer Incorrect Answer

    Solution

    Treasury bills (T-Bills) are short term (less than 1 year maturity) government debt securities that are auctioned by the Reserve Bank of India (RBI) on behalf of Government.  

    T-bills in India are presently issued in three tenors, namely,  91 day , 182 day and 364 day . T-bills are in nature of  zero coupon securities   i.e. do not pay interest but are issued at a discount and redeemed at the face value at maturity, leading to the implied interest/return/yield (difference of Face Value and Issue price as a percentage of Issue price).  

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