24-63 Swaps create value if
A)relative prices differ across markets.
B)there are barriers to entry in some markets.
C)information is costly.
D)All of the above.
E)None of the above.

Question

Quizplus · Accepted Answer

Swaps create value if there are differences in relative prices across markets, as this allows for profitable arbitrage. Additionally, barriers to entry in some markets can limit competition and increase profits. Finally, information can be costly and may not be equally available to all market participants, allowing savvy traders to take advantage of pricing discrepancies. Thus, all of the above are factors that can make swaps valuable.

24-63 Swaps Create Value If