If the inflation rate is 2%, the principal of a Treasury inflation protection security will rise from
$1,000 to $1,020.

Name: If the inflation rate is 2%, the principal of a Treasury inflation protection security will rise from $1,000 to $1,020.
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Treasury Inflation-Protected Securities (TIPS) adjust the principal based on the inflation rate. If the inflation rate is 2%, the principal increases by 2%, so $1,000 becomes $1,020.

If the Inflation Rate Is 2%, the Principal of a Treasury