The Collar of a Floating-Rate Bond Refers to the Minimum

question 49

Multiple Choice

The collar of a floating-rate bond refers to the minimum and maximum:

• A) call periods.
• B) maturity dates.
• C) market prices.
• D) coupon rates.
• E) yields to maturity.

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Definitions:

Private Placement

The sale of securities to a relatively small number of select investors as a way of raising capital, bypassing the public markets.

Securities

Financial instruments representing ownership (stocks), a debt agreement (bonds), or the rights to ownership (derivatives) that can be bought and sold.

SEC

The U.S. Securities and Exchange Commission, a federal agency responsible for enforcing federal securities laws and regulating securities industry participants.

Operations

The day-to-day activities carried out by a business to generate earnings, involving production, sales, and service provision.