A swap that technically is a succession of forward contracts on interest rates is
A)a commodity swap.
B)a credit swap.
C)a currency swap.
D)an equity swap.
E)an interest rate swap.

Question

Quizplus · Accepted Answer

An interest rate swap involves the exchange of cash flows based on a fixed rate and a variable rate (such as LIBOR). This technically involves a series of forward contracts on interest rates. The other options listed involve different types of swaps.

A Swap That Technically Is a Succession of Forward Contracts