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1 FINANCE MCQS

The principal value of TIPS (Treasury Inflation-Protected Securities) changes based on ____________?

  • Consumer Price Index
  • Manufacturing Price Index
  • Auction Selling Index
  • Inflation Payment Index
Correct Answer: A. Consumer Price Index

Detailed Explanation

The principal value of TIPS increases or decreases based on the Consumer Price Index (CPI), which measures inflation. This ensures that the investor’s return is protected against inflation

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