Why might an individual or organization be willing to swap fixed-rate loans for floating-rate loans?
A) They may perceive that interest rates are ready to increase.
B) Their cash flows may vary directly with interest rates.
C) Floating rates are not lower than fixed rates.
D) They may be able to postpone the payment of principal.

Question

Quizplus · Accepted Answer

Swapping to floating-rate loans can be beneficial if an individual's or organization's cash flows vary directly with interest rates, as it aligns their interest payments with their income.

Why Might an Individual or Organization Be Willing to Swap