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If You Purchase a Principal STRIPS, You Are Buying

Question 28

Multiple Choice

If you purchase a principal STRIPS, you are buying


A) The right to receive repayment out of a bond's next coupon payment
B) A security that will pay semi-annual interest along with a repayment of the face amount
C) A one-time payment that will be paid from the repayment of a bond's face value
D) A security backed by the interest payment on a Treasury notes
E) A security backed by the face value of a corporate bond

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