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Years to Maturity 2 0.02 Coupon Rate Coupons per Year 1 $1,000 Par Value ($) Yield to Maturity (t-0) 0.02 9 0 Required: 11 Treasury

Years to Maturity 2 0.02 Coupon Rate Coupons per Year 1 $1,000 Par Value ($) Yield to Maturity (t-0) 0.02 9 0 Required: 11 Treasury Inflation Protected Securities' (TIPS) principal and interest adjust to inflation. Discover the mechanics by filling in 12. Solve for the inflation adjusted par value and interest payments as well as the nominal and real rates of return. 13 14 (Use cells A4 to B8 from the given information to complete this question.) 15 15 Real Return (%) Time Inflation Rate Par Value ($) Interest Payment (S) Nominal Return (%) 17

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