In a Currency Swap, Which of the Following Type of Payment

question 101

Multiple Choice

In a currency swap, which of the following type of payment exchange is impossible?

• A) fixed payment in one currency for floating payment in another currency
• B) fixed payment in one currency for floating payment in the same currency
• C) floating payment in one currency for floating payment in another currency
• D) fixed payment in one currency for fixed payment in another currency

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Definitions:

Insured Risk

A risk that has been covered by an insurance policy, transferring the financial burden of a potential loss from the insured to the insurer.

Asymmetric Information

Asymmetric information occurs when one party in a transaction has more or better information than the other, leading to an imbalance in the decision-making process.

Unsuspecting Buyer

A consumer who purchases goods or services without being aware of all the relevant information, often leading to disadvantageous situations.

Auto Transmission

A type of vehicle transmission that automatically changes gear ratios as the vehicle moves, without input from the driver.