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Michael purchased a 5-year, $20,000 strip bond for $16,800 and he expects to hold the bond to maturity within an RRSP. What statement regarding an
Michael purchased a 5-year, $20,000 strip bond for $16,800 and he expects to hold the bond to maturity within an RRSP. What statement regarding an investment in a strip bond is FALSE? a) The purchaser of a strip bond does not receive regular interest payments based on the par value of the bond. b) A strip bond is purchased at a discount and it matures at a par value. c) Holding the strip within an RRSP shelters the interest income from taxation. d) If Michael holds the strip to maturity, it is subject to interest rate risk because the yield to maturity fluctuates during the term of the bond
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