A company enters into an interest rate swap where it is paying fixed and receiving LIBOR.When interest rates increase,which of the following is true?
A) The value of the swap to the company increases
B) The value of the swap to the company decreases
C) The value of the swap can either increase or decrease
D) The value of the swap does not change providing the swap rate remains the same

Question

Quizplus · Accepted Answer

When interest rates increase the LIBOR rates received are expected to be higher

A Company Enters into an Interest Rate Swap Where It