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    Financial Institutions Management
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    Exam 24: Options, Caps, Floors, and Collars
  5. Question
    A Contract That Pays the Par Value of a Loan
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A Contract That Pays the Par Value of a Loan

Question 19

Question 19

Multiple Choice

A contract that pays the par value of a loan in the event of default is a


A) put option.
B) call option.
C) digital default option.
D) futures option.
E) credit spread call option.

Correct Answer:

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