A 10 -year, capital-indexed bond linked to the Consumer Price Index (CPI) is issued with a coupon rate of 2% and a par value of 100,000. The bond pays interest semi-annually. During the first six months after the bond's issuance, the CPI increases by 2%. On the first coupon payment date:

The coupon payment increases by 1%.

The coupon payment is 1000.

None of the other answers are correct.

The principal payment increases by $2000.

The coupon rate increases by 2%