An investor is considering floating-rate d

问题单项选择题

An investor is considering floating-rate debt and other investments to protect against unexpected increases in inflation. Her friend suggests Treasury Inflation Protected Securities (TIPS) because the coupon rate is adjusted for inflation semiannually. The friend also states on-the-run Treasury issues have narrower bid-ask spreads than other Treasury issues. Should the investor agree or disagree with the friend’s statements about TIPS and on-the-run issues TIPS On-the-run issues （）①A. AgreeAgree ②B. AgreeDisagree ③C. Disagree Agree

A. ①

B. ②

C. ③

答案

参考答案：C

解析：

The friend is incorrect about the TIPS (the coupon rate is fixed, the par value is adjusted for inflation) and is correct about the bid-ask spread for on-the-run issues (on-the-run issues are more liquid and thus have a narrower bid-ask spread).