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Basic Question 1 of 1

A call option on interest rates will be in the money when the ______

A. current spot rate is higher than the exercise rate.
B. exercise rate is higher than the futures rate.
C. futures rate is higher than the current spot rate.

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I am using your study notes and I know of at least 5 other friends of mine who used it and passed the exam last Dec. Keep up your great work!
Barnes

Barnes

Learning Outcome Statements

calculate and interpret the value of an interest rate option using a two-period binomial model;

CFA® 2024 Level II Curriculum, Volume 5, Module 34.