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Posted on Jul 25, 2024

All other things being equal, the value of a floating rate bank loan with a 4.5% interest rate cap (ceiling limit on coupon rate bank

All other things being equal, the value of a floating rate bank loan with a 4.5% interest rate cap (ceiling limit on coupon rate bank can charge the borrower) should be more stable than the value of the same loan but with a 6% rate cap. Discuss.

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