A(n)_____________ is an agreement whereby one party agrees to trade periodic payments over a specified period of time, in a given currency, with another party who agrees to do the same in a different currency.

Question

Quizplus · Accepted Answer

A currency swap is an agreement to exchange principal and interest in different currencies between parties, which matches the description given. Interest rate swaps, floors, and caps involve interest rates in the same currency, not exchanges of different currencies.

A(n)_____________ Is an Agreement Whereby One Party Agrees to Trade