
Answer-first summary for fast verification
Answer: quoted margin.
**Explanation:** The specified yield spread over the reference rate for a floating-rate note (FRN) is referred to as the **quoted margin**. This margin compensates the investor for the difference in the credit risk of the issuer compared to the risk implied by the reference rate. - **Option A (coupon)** is incorrect because the coupon is the actual interest rate paid, which is the reference rate plus the quoted margin, not the spread itself. - **Option C (required margin)** is incorrect because the required margin is the yield spread that ensures the FRN is priced at par on a rate reset date, and it fluctuates based on market conditions and the issuer's credit risk, rather than being specified upfront.
Author: LeetQuiz Editorial Team
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