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      Question

      Under what circumstances does a drop lock bond convert

      from a floating rate to a fixed rate bond?
      A If the interest rate falls below the predetermined level Correct Answer Incorrect Answer
      B At the discretion of the bond issuer Correct Answer Incorrect Answer
      C If the interest rate rises above the predetermined level Correct Answer Incorrect Answer
      D At the maturity date of the bond Correct Answer Incorrect Answer

      Solution

      The correct answer is A

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