A 295 Percent TIPS Has an Original Reference CPI of 180

question 59

Multiple Choice

A 2.95 percent TIPS has an original reference CPI of 180.2. If the current CPI is 205.1, what is the current interest payment and par value of the TIPS? (Assume semiannual interest payments and $1,000 par value.)

• A) $16.79, $878.60, respectively
• B) $29.50, $1,000.00, respectively
• C) $16.79, $1,138.18, respectively
• D) $29.50, $1,138.18, respectively

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