An interest rate collar has a cap strike rate of 10.00% and a floor strike rate of 9.50%.If the reference interest rate moves from 9.50% to 9.75%,what is the effective rate of the collar?
A) 9.50%
B) 9.625%
C) 9.75%
D) 9.875%
E) 10.00%
Correct Answer:
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