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Basic Question 18 of 18
Supposed for an inverse floater which has a floor rate of 1%:
Coupon Rate = 4% - (2 x 3-month treasury bill rate)
Now suppose we want to calculate coupon rate as on Oct 5, 2021. The 3-month treasury bill rate as on Oct 5, 2021 = 2.25%. What is the coupon rate? A. -0.5%
B. 0%
C. 1%
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Learning Outcome Statements
describe common cash flow structures of fixed-income instruments
CFA® 2024 Level I Curriculum, Volume 4, Module 2.