Question: Reconsider the 2 25 percent TIPS discussed in problem 7 20 It
Reconsider the 2.25 percent TIPS discussed in problem 7-20. It was issued with CPI reference of 187.2. The bond is purchased at the beginning of the year (after the interest payment), when the CPI was 197.1. For the interest payment in the middle of the year, the CPI was 200.1. Now, at the end of the year, the CPI is 203.8 and the interest payment has been made. What is the total return of the TIPS in dollars and in percentage terms for the year?
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