- CFA Exams
- CFA Level I Exam
- Study Session 13. Fixed Income (2)
- Reading 34. Valuation and Analysis of Bonds with Embedded Options
- Subject 3. Valuation of Default-Free Callable and Putable Bonds
CFA Practice Question
If the level of the interest rates goes up, which value(s) will drop?
II. The value of a call option.
III. The value of a put option.
I. The value of a putable bond.
II. The value of a call option.
III. The value of a put option.
A. I and II
B. II and III
C. I, II and III
Explanation: The value of a put option will go up.
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