Government Bonds
Which of the following securities uses the actual/actual day count convention for calculating accrued interest?
Treasury = Actual/Actual. Muni & Corporate = 30/360. Money Market = Actual/360.
Complete Analysis & Legal Rationale
U.S. Treasury securities use the actual/actual day count convention, counting the actual number of days in each month and year. This differs from municipal and corporate bonds which use 30/360.
Distractor Autopsy (Why Other Options Are Traps)
FINRA exam writers design incorrect distractors using specific calculation mistakes and regulatory misconceptions. Review why each option succeeds or fails:
Municipal bonds use the 30/360 convention.
Corporate bonds use the 30/360 convention.
Matches the verified teaching point in the explanation.
Commercial paper uses actual/360 (money market convention).
Official Standard: Outline-level citation pending rule-specific upgrade. Verify against current FINRA Series 7 outline.