› CFA › CFA Level 2 › Question of the Week: Level 2 – Fixed Income Search for:Search Button CFAFRMCAIACareersLounge GeneralLevel 1Level 2Level 3 Question of the Week: Level 2 – Fixed Income Add A Reply Login Sign Up This topic has 1 reply, 1 voice, and was last updated Apr-206:34 pm by MarkMeldrum. Author Posts MarkMeldrumParticipant Undecided 27 Apr 2020 at 6:34 pm Up0:: The correct answer is Option A. Lowering the OAS from 55bps to 25bps lowers all the forward rates in the interest rate tree by 30bps. This will result in higher bond values at each node increasing the probability of a call. This will increase the value of the call option. Author Posts Viewing 0 reply threads You must be logged in to reply to this topic. Log In Username: Password: Keep me signed in Register Log In