The US Treasury Issues Bonds Where the Return Is Indexed to to the Consumer

question 71

Multiple Choice

The U.S. Treasury issues bonds where the return is indexed to the consumer price index. We should expect that these bonds, relative to other U.S. Treasury bonds, will have:

• A) lower price and lower return due to the decreased risk.
• B) lower price and a lower fixed return since the demand for them should be higher.
• C) higher price and higher fixed return since we always seem to have some inflation.
• D) higher price and lower return due to the decreased risk from inflation in holding these bonds.

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Depressed Mood

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Obsessive-Compulsive Disorder

A mental health disorder characterized by persistent, unwanted thoughts (obsessions) and repetitive behaviors (compulsions) as an attempt to alleviate anxiety.

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The action of determining the total number of items in a group by assigning them numerical order.

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Thinking or behavior that lacks reason or logic, often driven by emotions rather than factual reasoning.