How Does Inflation Affect Bonds?
The bond pays fixed amounts while prices do not stay fixed, so the same payment buys less.
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1.What is leak one for a bond in an inflationary period?
The bond pays fixed amounts while prices do not stay fixed, so the same payment buys less.
2.What is the real rate, according to the Fed Education page?
The Federal Reserve Education page puts the real rate as nominal rate minus the inflation rate; 3 minus 4 is minus 1 percent.
3.A bond of 500 has a 3 percent coupon. How much is the coupon each year?
The coupon is the fixed interest the bond pays each year; a bond of 500 with a 3 percent coupon pays 15 a year.
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Education only. Not financial advice.