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Given the following information, what's the best strategy of a smart investor? 1) The yield on a 3-year, risk-free T-note =3% 2) The yield on

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Given the following information, what's the best strategy of a smart investor? 1) The yield on a 3-year, risk-free T-note =3% 2) The yield on a 3 -year, BB-grade bond =6%, with the 3% spread reflecting only credit risk 3) The credit spread on a 3-year CDS on the 3-year, BB-grade bond is 2% [A] do nothing, no investment no loss [B] long the T-note, short BB-grade bond and CDS [C] short the T-note, long BB-grade bond and CDS [D] only long BB-grade bond and CDS as the yield is higher than T

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