You Buy a TIPS at Issue at Par for $1,000

question 57

Multiple Choice

You buy a TIPS at issue at par for $1,000.The bond has a 3% coupon.Inflation turns out to be 2%,3% and 4% over the next three years.The total annual coupon income you will receive in year three is _________.

• A) $30.00
• B) $33.00
• C) $32.78
• D) $30.90

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Definitions:

Criminal Law

The body of law that relates to crime, prescribing conduct perceived as threatening, harmful, or otherwise endangering to the property, health, safety, and moral welfare of people.

Main Objective

The primary goal or purpose intended to be achieved by a person, project, or organization.

Punish

The act of imposing a penalty or sanction on someone as a result of their wrongdoing or misbehavior.

Public Prosecutor

A government official who conducts criminal prosecutions on behalf of the state or the people, ensuring the enforcement of the law.