________ pay a fixed coupon (usually 4%) with the increase in the CPI added to the capital value of the bond and paid on maturity.

Question

Quizplus · Accepted Answer

The description accurately fits capital-indexed securities, which pay a fixed coupon but also adjust the capital value based on changes in the CPI. Fixed-indexed securities could also be a valid answer, but the term "fixed-coupon" in the description rules out choice C. Choice D ("CPI securities") is not a commonly used term in finance, making it less likely to be the correct answer.

________ Pay a Fixed Coupon (Usually 4%) with the Increase