A TIPS bond issued by the Treasury Department was issued with an ANNUAL coupon of 5%.The bond has a par value of $1,000 and will mature in 10 years.Suppose that inflation during the first year of the bond's life was 3%.What is the new coupon payment for this bond?
A) $50.97
B) $51.50
C) $53.00
D) $81.50
Correct Answer:
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