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Alexander would like to invest in bonds but he is concerned that inflation will persist, eroding his purchasing power. His investment advisor recommended real return
Alexander would like to invest in bonds but he is concerned that inflation will persist, eroding his purchasing power. His investment advisor recommended real return bonds. Why are these suitable for Alexander? The interest payment will increase with an increase in CPI. The bond pays interest + plus principal periodically throughout the life of the bond. They are purchased at a discount and mature at par. All of the above
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