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The physical properties of several kinds of single walled carbon nanotubes containing a single carbon chain in their interior are investigated with density functional theory, using the Vienna ab initio Simulation Package (VASP). The optimized geometry and the electronic band structure are both examined, and compared to the results of the isolated subsystems: the isolated carbon chain and the isolated nanotube. We find bondlength alternation in the optimized geometry of the isolated chain, as well as a gap in the band structure, clear signs of Peierls distortion. In the combined systems, hybridization and charge transfer are found between the tube and the chain, resulting in a partial or complete breakdown of the Peierls distortion of the carbon chain. The combined systems are always predicted to be metallic, even if both subsystems are semiconductors, and even if the chain still exhibits some bond length alternation. © 2005 American Institute of Physics [ABSTRACT FROM AUTHOR]