1. at bond issuance
  2. expected in future
  3. expected at time of maturity
  4. expected at deferred call
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1 Answers

Answer: Option 2

An inflation rate includes in bond's interest rates is one which is inflation rate expected in future. Inflation is measured in a variety of ways depending upon the types of goods and services considered and is the opposite of deflation which indicates a general decline occurring in prices for goods and services when the inflation rate falls below 0 percent.

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