A 375 Percent TIPS Has an Original Reference CPI of 175

A 3.75 percent TIPS has an original reference CPI of 175.8. If the current CPI is 207.7, what is the current interest payment and par value of the TIPS? (Assume semiannual interest payments and $1,000 par value.)

A) $1,000, $18.75, respectively
B) $1,000, $37.50, respectively
C) $1,181.46, $22.15, respectively
D) $1,181.46, $37.50, respectively

Correct Answer:

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