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Required information

Treasury securities are issued and backed by the U$.$S$.$ government and, therefore, are considered to be the lowest$-$risk

securities on the market. As an investor looking for protection against inflation, you are considering the purchase of

inflation$-$adjusted bonds known as U$.$S$.$ Treasury Inflation$-$Protected Securities $($TIPS$).$ With these securities$,$ the face value

$($which is paid at maturity$)$ and the bond interest rate $($which is paid semiannually$)$ is regularly adjusted to account for

inflation. However, for this problem only, assume the semi$-$annual interest payment $($called the bond dividend$)$ remains the

same.

You purchased a $10-$year $$10,000$ TIPS bond with dividend of $4\%$ per year payable semiannually $($i$.$e$.,$ $$200$ every $6$

months$).$ Assume there is no inflation adjustment for the first $5$ years, but in years $6$ through $10,$ the bond face value

increases by $$550$ each year. You use an expected investment return of $8\%$ per year compounded semiannually.

NOTE: This is a multi$-$part question. Once an answer is submitted, you will be unable to return to this part.

What is the net amount of money that you will have received during the $10-$year life of the bond without any consideration of dividend

reinvestment?

The total net amount of money that you would have received is $