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An Inflation-Index Bond Is One Where the

Question 57

Multiple Choice

An inflation-index bond is one where the


A) coupon rate is adjusted every six months for changes in inflation.
B) interest payments every six months are adjusted for inflation based on the inflation-adjusted coupon rate.
C) principal amount is adjusted for inflation at the time when a coupon payment is made, usually every six months and the inflation adjusted principal is repaid at maturity.
D) None of the above is correct.

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