A bank makes long-term fixed-rate loans, and funds itself with short-term deposits. It can best manage its vulnerability to interest rate changes by
A) Entering into a basis (floating-floating) swap.
B) Entering into a pay-floating/receive-fixed interest rate swap.
C) Entering into a pay-fixed/receive-floating interest rate swap.
D) Entering into a fixed-fixed swap where the two legs have different payment frequencies.
Correct Answer:
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Q1: The main difference between the "short-form" and
Q3: A plain vanilla interest-rate swap is an
Q4: Which of the following is not true
Q5: An important difference between a floating-rate note
Q6: The main difference between the "short-form" and
Q7: Choose the most appropriate of the following
Q8: An amortizing interest-rate swap is one in
Q9: You enter into a $100 million notional
Q10: In a plain vanilla fixed-for-floating swap,
A) Fixed
Q11: Firm A can borrow at 4%
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