One of the problems with most bonds is that their coupon payment is fixed and rising inflation weakens the purchasing power of their coupon payments.Which of the following bonds is the best option during times of high inflation?

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TIPS (Treasury Inflation-Protected Securities) are the best option during times of high inflation because their coupon payments are adjusted for inflation. This means that as inflation rises, the coupon payment will increase, maintaining the purchasing power of the bond's cash flows. FNMA Agency bonds, high grade corporate bonds, and high yield speculative bonds do not have this inflation protection feature, making them less attractive in times of high inflation.

One of the Problems with Most Bonds Is That Their