Discount note,

Definition of Discount note:

1. Short-term obligation (promissory note) sold at a discount on its par value in lieu of paying interest.

2. A discount note is a short-term debt obligation issued at a discount to par. Discount notes are similar to zero-coupon bonds and Treasury bills (T-Bills) and are typically issued by government-sponsored agencies or highly-rated corporate borrowers.

3. Discount notes have maturity dates of up to one year in length. Discount notes do not offer investors periodic interest payments. Instead, investors purchase discount notes at a discounted price and receive the note's face value (also called "par value") at maturity.

How to use Discount note in a sentence?

1. Government discount notes are considered safe investments because they are backed by the full faith and credit of the United States government.
2. The profit the investor earns is the spread between the discounted purchase price of the note and the face value redemption price the investor receives upon the note's maturity.
3. Corporations and governments sell discount notes to investors in order to raise short-term capital for various projects.
4. A discount note refers to a short-term debt obligation usually issued by highly-rated corporations or government-sponsored entities.
5. Discount notes are issued at a discount to par, which means investors purchase them at a cost lower than the note's face value.