The following statement,"investors must forgo some yield when compared with straight bonds because of the lower risk,and the market should price these accordingly",refers to index-linked bonds.

Question

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CPI-linked bonds tend to be issued by government authorities,and work by giving protection against inflation to investors by providing a set level of real return.The most common form of these securities is the capital-indexed bonds.Each year,the redemption or face value of the bond is indexed upward by the rate of inflation.

The Following Statement,"investors Must Forgo Some Yield When Compared with Straight