Problem 7-33 TIPS Total Return (LG7-2)Consider a 3.5 percent TIPS with an issue CPI reference of 185.6. The bond is purchased at the beginning of the year (after the interestpayment), when the CPI was 193.5. For the interest payment in the middle of the year, the CPI was 195.1. Now, at the end of the year,the CPI is 199.6 and the interest payment has been made.What is the total return of the TIPS in dollars? (Do not round intermediate calculations. Round your final answer to 2 decimal places.)Total returnWhat is the total return of the TIPS in percentage? (Do not round intermediate calculations. Round your final answer to 2 decimalplaces.)Total return%

Treasury Inflation-Protected Securities (TIPS) are ones that the US Department of Treasury issues to…

What is the total return of the TIPS in dollars? (Do not round intermediate calculations. Round your final answer to 2 decimal places.) Total return What is the total return of the TIPS in percentage? (Do not round intermediate calculations. Round your final answer to 2 decimal places.) Total return %

What is the total return of the TIPS in dollars? (Do not round intermediate calculations. Round your final answer to 2 decimal places.) Total return What is the total return of the TIPS in percentage? (Do not round intermediate calculations. Round your final answer to 2 decimal places.) Total return %

Essentials Of Investments

11th Edition

ISBN:9781260013924

Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Chapter1: Investments: Background And Issues

Section: Chapter Questions

Problem 1PS

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Similar questions

Calculate the standard deviation of the following returns. Year Return 1 0.01 2 0.27 3 0.02 4 0.02 5 0.22 Enter the answer with 4 decimals, e.g. 0.1234.
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Concord Pix currently uses a six-year-old molding machine to manufacture silver picture frames. The company paid $95,000 for the machine, which was state of the art at the time of purchase. Although the machine will likely last another ten years, it will need a $12,000 overhaul in four years. More important, it does not provide enough capacity to meet customer demand. The company currently produces and sells 9,000 frames per year, generating a total contribution margin of $92,500. Martson Molders currently sells a molding machine that will allow Concord Pix to increase production and sales to 12,000 frames per year. The machine, which has a ten-year life, sells for $135,000 and would cost $10,000 per year to operate. Concord Pix's current machine costs only $8,000 per year to operate. If Concord Pix purchases the new machine, the old machine could be sold at its book value of $5,000. The new machine is expected to have a salvage value of $19,900 at the end of its ten-year life. Concord…
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