When a Bank Enters into a Fixed-Floating Currency Swap, It

question 44

Multiple Choice

When a bank enters into a fixed-floating currency swap, it is exposed to

• A)both interest rate and currency exposures.
• B)only interest rate exposures.
• C)only exchange rate exposure.
• D)zero interest rate exposure over the life of the swap.
• E)zero interest rate and currency exposure over the life of the swap.

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Definitions:

Connective Tissue

Tissue that supports, connects, or separates different types of tissues and organs in the body, characterized by few cells and extensive extracellular matrix.

Erythrocytes

Red blood cells responsible for carrying oxygen from the lungs to the body's tissues and returning carbon dioxide from the tissues back to the lungs.

Leukocytes

Immune system components, white blood cells play a crucial role in defending the body against infectious diseases and external threats.

Blood Volume

The total volume of blood circulating within the body.