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Basic Question 2 of 2
Under the pathwise valuation approach, the value of the bond is:
B. The geometric average of the values of the bond at each path.
C. The value that occurs most often from all paths (the mode).
A. The arithmetic average of the values of the bond at each path.
B. The geometric average of the values of the bond at each path.
C. The value that occurs most often from all paths (the mode).
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I passed! I did not get a chance to tell you before the exam - but your site was excellent. I will definitely take it next year for Level II.
Tamara Schultz
Learning Outcome Statements
describe pathwise valuation in a binomial interest rate framework and calculate the value of a fixed income instrument given its cash flows along each path;
CFA® 2024 Level II Curriculum, Volume 4, Module 29.