Weegy: A Treasury Bill, often abbreviated as T-Bill, is a type of security issued by the United States Treasury through the Bureau of Public Debt. [ Along with an assortment of other securities, T-Bills are used to finance the United States Government by borrowing money from citizens. Investors purchase T-Bills when they become available, and when they mature after a set period of time, usually less than a year, the investors may redeem their T-Bills for the face value. The purchase price of the T-Bill serves as a temporary loan to the United States Government, which returns it when the T-Bill matures.
The smallest face value for a T-Bill is $1,000 US Dollars (USD). The T-Bill is sold at a discount, which is determined by the Bureau of Public Debt, but the Treasury pays the full face value when it is redeemed. For example, an investor might purchase a 90-day T-Bill for $900 USD, and earn a $100 USD return on the investment when the T-Bill is redeemed. Unlike many other securities, a T-Bill does not bear interest, but the return on a T-Bill is highly predictable and very stable, barring complete financial collapse of the United States Treasury.
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User: why does this instrument impact the variable rate?
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