Q7 Exam 1 AM

This question is nonsense The question talks about hedging, but the answer gives preference to using options since the firm will not lose if rates sell off. The answer has: No discussion of the cost of buying options. Ignores the fact they are talking about T Bond options, i.e on the 30 yr bond As opposed to a T note option or some combination of 2’s 10’s 30’s Thankfully the CFA questions are better written.