Question: Consider a newly issued TIPS bond with a 3-year maturity. par value of $1,000, and coupon rate of 4.10%. Assume annual coupon payments. 19 Coupon
Consider a newly issued TIPS bond with a 3-year maturity. par value of $1,000, and coupon rate of 4.10%. Assume annual coupon payments. 19 Coupon + Principal payment repayment Total payment 8 02-1700 Tine 0 1 2 Inflation in year just ended Par value $1,000.00 2.14 $1,021.00 $1,032.23 3.10 $1,064.23 $41.86 $42.32 $43.63 0 $ 41.86 0 $ 42.32 $1,064.23 $1,107.86 What is the nominal rate of return on the TIPS bond in the first year? Multiple Choice 4191
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