What Is the Difference Between an Inflation-Indexed Treasury Bond,and a Treasury

question 46

Multiple Choice

What is the difference between an inflation-indexed Treasury bond,and a Treasury bond that is not indexed?

• A) An inflation-indexed Treasury bond guarantees a certain real rate of return,while a nonindexed Treasury bond does not.
• B) A nonindexed Treasury bond guarantees a certain real rate of return,while a nonindexed Treasury bond does not.
• C) An inflation-indexed Treasury bond can only be purchased directly from the Federal Reserve,while a nonindexed Treasury can be purchased through a broker.
• D) An inflation-indexed Treasury bond always guarantees the purchaser a 5 percent rate of return,while a nonindexed Treasury bond does not.