The market considers the risk of default of U.S. treasury bonds to be close to zero Select one: • True • False

The statement "The market considers the risk of default of U.S. treasury bonds to be close to zero" is True.

Explanation:

U.S. Treasury bonds are often regarded as one of the safest investment vehicles available, primarily because they are backed by the "full faith and credit" of the U.S. government. The likelihood of the U.S. government defaulting on its debt obligations is exceedingly low due to its ability to generate revenue through taxation and its control over monetary policy. Additionally, U.S. Treasury securities enjoy a high level of liquidity, making them attractive to investors seeking safety. While there may be fluctuations in market prices due to interest rate changes, the actual default risk remains close to zero, reinforcing their status as a secure investment option. This is why they are frequently used as a benchmark for measuring other investments' risk.