Final answer:
A Treasury bond is a financial contract involving a borrower who agrees to repay the loaned amount with interest over a future period. It is issued by the federal government and is one way governments finance their activities.
Step-by-step explanation:
The financial contract that involves a borrower agreeing to repay the borrowed amount along with an interest rate over a future period of time is a Treasury bond. A bond is a formal financial agreement where the borrower is obliged to repay the principal amount loaned, plus the interest, at specified future dates. This repayment is typically structured over a series of payments. Treasury bonds, in particular, are issued by the federal government through the U.S. Department of the Treasury and are a common way for governments to raise funds. Similar instruments include corporate bonds, municipal bonds, and state bonds, each issued by different entities and varying by terms and risk levels.