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Which One of the Following Statements Related to a Put

Question 37

Multiple Choice

Which one of the following statements related to a put bond is correct?


A) Put bonds are generally redeemed at a premium over par value.
B) Put bonds can be redeemed at any time once the put protection period has elapsed.
C) The put feature effectively sets the ceiling price for the bond.
D) The put feature helps protect bondholders from the risk associated with rising interest rates.
E) A putable bond is generally priced lower than a comparable nonputable bond.

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