Q. Consider the following statements about the Floating Rate Bonds: Coupon rate is not fixed The Coupon rate is reset with reference to a benchmark rate Sold at a discount from the face value Which among the above statements is/ are correct?
Answer: 1 & 2
Notes: Based on the information provided about Floating Rate Bonds, the statements that are correct are:

1. Coupon rate is not fixed
2. The Coupon rate is reset with reference to a benchmark rate

The third statement "Sold at a discount from the face value" is not necessarily correct about Floating Rate Bonds in general. Floating Rate Bonds can be sold at par, at a premium, or at a discount from face value depending on market conditions and demand. But they are not inherently sold at a discount simply by virtue of being Floating Rate Bonds.

2

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