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Basic Question 0 of 4

Floating-rate bonds have adjustable rates to protect real rates of return against inflation. The rates paid are limited by ______.

I. the put provisions of the issues
II. a floor rate that sets the minimum
III. a cap rate that sets the maximum

User Contributed Comments 2

User Comment
RCapistrano Protect both bond issuers(III) and holders(II).
2014 If modified question
Protection only to bondholders: floor rate
Protection only to issuers: Cap rate
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Craig Baugh

Learning Outcome Statements

describe how model misspecification affects the results of a regression analysis and how to avoid common forms of misspecification;

CFA® 2025 Level II Curriculum, Volume 1, Module 3.