A floating-for-fixed currency swap is equivalent to
A. Two interest rate swaps, one in each currency
B. A fixed-for-fixed currency swap and one interest rate swap
C. A fixed-for-fixed currency swap and two interest rate swaps, one in each currency
D. None of the above
B
A floating-for-fixed currency swap where the floating rate is paid in currency X and the fixed rate is received in currency Y is equivalent to (a) a fixed-for-fixed currency swap where, say, 5% in currency X is paid and the fixed rate in currency Y is received, (b) a regular interest rate swap where 5% in currency X is received and floating in currency X is paid.
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Sonesta Farm Equipment Company sold equipment for cash. The income statement shows a loss on the sale of $7,000. The net book value of the asset was $28,900. Which of the following statements describes the cash effect of the transaction?
A) positive cash flow of $35,900 from financing activities B) negative cash flow of $21,900 for operating activities C) negative cash flow of $21,900 for financing activities D) positive cash flow of $21,900 from investing activities
SimQuick can be used to simulate all of the following EXCEPT:
A) a call center with completely random call arrivals and processing times. B) a hospital emergency room with arrivals that vary during different time periods throughout the day. C) a manufacturing process with a constant arrival rate (e.g., every 2 minutes) at one of the process steps. D) the hiring of production workers, based on skill requirements throughout the year.