A. tax adjusted principal
B. inflation adjusted principal
C. auction adjusted principal
D. premium adjusted principal
✅ The correct answer is option B.
Principal amount in Treasury Inflation Protection Securities is considered as inflation adjusted principal. Treasury Inflation-Protected Securities (TIPS) are a form of U.S. Treasury bond designed to help investors protect against inflation. These bonds are indexed to inflation, have U.S. government backing, and pay investors a fixed interest rate as the bond’s par value adjusts with the inflation rate.
Principal amount in Treasury Inflation Protection Securities is considered as inflation adjusted principal. Treasury Inflation-Protected Securities (TIPS) are a form of U.S. Treasury bond designed to help investors protect against inflation. These bonds are indexed to inflation, have U.S. government backing, and pay investors a fixed interest rate as the bond’s par value adjusts with the inflation rate.