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Which of the Following Statements About Treasury Inflation-Indexed Bonds Is

Question 36

Multiple Choice

Which of the following statements about Treasury inflation-indexed bonds is not true?


A) The principal amount used to compute the interest payment varies with the consumer price index.
B) The interest payment rises when inflation occurs.
C) The interest rate rises when inflation occurs.
D) At maturity, the securities pay the greater of face value or inflation-adjusted principal.

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