In January 2010,the U.S.Treasury issued a $1000 par.five-year,inflation-indexed note with a coupon of 5%.On the date of issue,the consumer price index (CPI)was 250.By January 2020, the CPI had decreased to 200.The principal payment that was made in January 2015 is closest to:

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B) The CPI depreciated by 200/250 = 0.8. Consequently the principal amount of the bond decreases (for interest purposes) by this amount so the new principal (for interest purposes) = $1000 x 0.8= $800. However, in the event of depreciation with the CPI these bonds will repay par, which is $1000 in this case.