When two parties agree at a specified future date to exchange an amount of money based on a reference interest rate and a notional principal amount, the agreement is commonly referred to as:
A) Interest rate swap.
B) Forward rate agreement.
C) Swaption.
D) Caption.
E) None of the above.
Correct Answer:
Verified
Q1: Commercial banks and investment banks customize for
Q2: A common OTC option between two sectors
Q3: An option to purchase an option is
Q4: An option that allows the option buyer
Q6: In an interest rate swap, the position
Q7: The use of an interest rate swap
Q8: The initial motivation for the interest rate
Q9: Interest rate swaps:
A) Can be replicated by
Q10: Intermediaries involved in interest rate swaps performed
Q11: The date the a swap begins accruing
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