Floating rate notes behave differently in response to interest rate risk than straight fixed-rate bonds.
A) True since FRNs experience only mild price changes between reset dates,over which time the next period's coupon payment is fixed (assuming,of course,that the reference rate corresponds to the market rate applicable to the issuer) .
B) False since all bonds experience an inverse price change when the market rate of interest changes.
C) all of the options
D) none of the options
Correct Answer:
Verified
Q46: Six-month U.S.dollar LIBOR is currently 4.25 percent;
Q47: Eurobonds are usually
A)registered bonds.
B)bearer bonds.
C)floating-rate,callable and convertible.
D)denominated
Q48: The coupon interest on Eurobonds
A)is paid annually.
B)is
Q49: Floating-rate notes
A)are a form of adjustable rate
Q50: On a reset date,floating-rate notes
A)experience very volatile
Q52: Find the price of a 30-year zero
Q53: Floating-rate notes (FRN)
A)experience very volatile price changes
Q54: Consider a bond with an equity warrant.The
Q55: Straight fixed-rate bond issues have
A)a designated maturity
Q56: A ten-year floating-rate note (FRN)has coupons referenced
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