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Business, 06.05.2020 07:32 jayzeptor

Suppose that the annual coupon rate for a TIPS is 2%. Suppose further that an investor purchases $100,000 of par value (initial principal) of this issue today and that the semiannual inflation rate is 1.25% (so the annual inflation rate is 2.5%). What is the dollar coupon interest that will be paid in cash at the end of the first six months?

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Suppose that the annual coupon rate for a TIPS is 2%. Suppose further that an investor purchases $10...

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