New semiannual interest? payment

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A ?$1,000 Treasury? inflation-protected security is currently selling for ?$935 and carries a coupon interest rate of 3.36 percent.

b. If? there's a 0.83 percent increase in? inflation, what will be the new par value of the? bond?

c. What is your new semiannual interest? payment?

d. What would the par value be at? maturity, assuming a 2.00 percent annual inflation rate and? ten-year maturity? period?

a. If you buy this? bond, assuming no interest adjustment to principal during this time? period, your first interest payment would be ?$16.80 ? (Round to the nearest? cent.)

b. If? there's a 0.83 percent increase in? inflation, the new par value would be what?

Reference no: EM133069279

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