Generally, the Holder of a Government Bond That Is Indexed

Multiple Choice

Generally, the holder of a government bond that is indexed to the price level knows

A) either the interest rate, the principal, or both are adjusted for inflation
B) the real interest rate will fluctuate with inflation
C) there will be no losses as long as inflation is anticipated, but losses can occur if there is an unanticipated increase in the inflation rate
D) all of the above
E) none of the above