An Interest Rate Floor Is

question 8

Multiple Choice

An interest rate floor is:

• A) a European put option on the spot interest rate
• B) an American put option on the spot interest rate
• C) a portfolio of European put options on the spot interest rate
• D) a portfolio of American put options on the spot interest rate
• E) a portfolio of European call options on the spot interest rate

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Definitions:

Triethylamine

A strong, organic base with the formula (C2H5)3N, used as a catalyst and solvent in chemical synthesis.

Z Isomer

Refers to an isomer where the highest priority groups on either side of a double bond or around a ring system are on the same side, following CIP priority rules.

1-Bromopentane

An organic compound classified as an alkyl halide, consisting of a five-carbon chain with a bromine atom attached to the first carbon.

Acetone

A colorless, volatile, flammable liquid ketone, widely used as a solvent and as a precursor to other organic compounds.