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Adjustable-Rate Bonds Are Identified by Which One of the Following

Question 8

Multiple Choice

Adjustable-rate bonds are identified by which one of the following characteristics?


A) The coupon rate will increase should the credit rating of the bond decline.
B) Different bonds within the same issue have different coupon rates.
C) Bondholders can defer coupon payments at their discretion.
D) The amount of each coupon payment will depend on the free cash flow of the issuer.
E) The coupon rate changes in response to changes in current market rates.

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