Help
Course Catalog > Bonds > 200
Bonds 207: Treasury Inflation-Adjusted Securities

Test your knowledge

Choose wisely. There is only one correct answer to each question.

0%
Keep studying!
Review your answers below to learn more.
1.
In periods of deflation, inflation-adjusted securities will increase in value.
Choose wisely. There is only one correct answer.
False. In periods of deflation, inflation-adjusted securities will decrease in value, but not below their par values.
2.
A bond's reference CPI-U is actually the CPI from three months prior to the bond's issue date.
Choose wisely. There is only one correct answer.
True. A bond's reference CPI-U is actually the CPI from three months prior to the bond's issue date.
3.
Par value measures the effects of inflation.
Choose wisely. There is only one correct answer.
False. The CPI-U measures the effects of inflation.
4.
You don't have to pay state income taxes on interest earned from Treasury inflation-adjusted securities.
Choose wisely. There is only one correct answer.
True. You are exempt from state income taxes on interest earned from Treasury inflation-adjusted securities.
5.
The principal of an inflation-adjusted bond is always guaranteed to its investor.
Choose wisely. There is only one correct answer.
False. The principal of an inflation-adjusted bond is guaranteed by the full faith and credit of the US government if an investor holds onto it until its maturity.