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Basic Question 9 of 12

Continue with the previous question. Show that the payoff is equivalent to that of a call option on a bond with an exercise price of $1 (the par value of the bond).

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I am happy to say that I passed! Your study notes certainly helped prepare me for what was the most difficult exam I had ever taken.
Andrea Schildbach

Andrea Schildbach

Learning Outcome Statements

describe how the Black model is used to value European options on futures;

describe how the Black model is used to value European interest rate options and European swaptions;

CFA® 2025 Level II Curriculum, Volume 5, Module 32.