A Swap That Technically Is a Succession of Forward Contracts

question 71

Multiple Choice

A swap that technically is a succession of forward contracts on interest rates is

• A)a commodity swap.
• B)a credit swap.
• C)a currency swap.
• D)an equity swap.
• E)an interest rate swap.

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Definitions:

Fixed Costs

Expenses that do not change with the level of production or sales over a short period, such as rent, salaries, and insurance.

Break-even Sales

The amount of revenue that must be generated to cover total fixed and variable costs, resulting in zero net income or loss.

Unit Selling Price

The price at which a single unit of a product is sold, determining the revenue generated from sales.

Variable Costs

Costs that vary directly with the level of production or business activity, such as materials and labor.