__________ are bonds whose principal amount is adjusted for inflation at the time when coupon payments are made. The coupon payment is based on the inflation-adjusted principal.

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Inflation-indexed bonds, also known as inflation-linked bonds or colloquially as TIPS (Treasury Inflation-Protected Securities), are designed to protect the investor against inflation. They adjust the principal amount for inflation, based on the Consumer Price Index (CPI), and the coupon payment is based on the inflation-adjusted principal. This ensures that the investor is receiving a real rate of return, regardless of inflationary pressures.

__________ Are Bonds Whose Principal Amount Is Adjusted for Inflation