The buyer of a floor benefits if the designated reference:
A) Stays the same.
B) Rises above the strike rate.
C) Falls below the strike rate.
D) None of the above.
Correct Answer:
Verified
Q10: When the seller agrees to pay the
Q11: In an interest rate cap or floor
Q12: In a cap or floor, the only
Q13: A cap and a floor can be
Q14: The buyer of a cap benefits if
Q16: A cap is equivalent to:
A) A package
Q17: A floor is equivalent to:
A) A package
Q18: When two parties agree to swap payments
Q19: Swaps are currently traded in the over-the-counter
Q20: Swaps can be used for asset/liability management
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