____ swaps are oFten used by companies to hedge against ____ rate risk.

Question

Quizplus · Accepted Answer

Interest rate swaps are used by companies to hedge against interest rate risk, allowing them to exchange interest rate payments with another party, often swapping fixed for variable rates or vice versa. Currency swaps are used to hedge against exchange rate risk, allowing companies to exchange principal and interest in one currency for the same in another currency, thus managing exposure to currency fluctuations.

____ Swaps Are OFten Used by Companies to Hedge Against