Seeing is believing!
Before you order, simply sign up for a free user account and in seconds you'll be experiencing the best in CFA exam preparation.
Basic Question 3 of 7
The rate used to discount a stripped Treasury bond payment is:
B. the current 90-day T-bill rate.
C. the zero-coupon bond rate for a Treasury bond of the same maturity.
A. the on-the-run Treasury yield for a bond of the same maturity.
B. the current 90-day T-bill rate.
C. the zero-coupon bond rate for a Treasury bond of the same maturity.
User Contributed Comments 5
| User | Comment |
|---|---|
| zeiad | WHY C ?? BECAUSE OF ZERO-COUPON BOND |
| zkhan87 | bullet pymts = zero cpn rates |
| johntan1979 | The theoretical Treasury zero-coupon rates or Treasury spot rates |
| farhan92 | strip the coupons of the sexy thang |
| chesschh | strip to zero |
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
Learning Outcome Statements
explain what is meant by arbitrage-free valuation of a fixed-income instrument;
calculate the arbitrage-free value of an option-free, fixed-rate coupon bond;
CFA® 2025 Level II Curriculum, Volume 4, Module 27.