A Credit Default Swap

question 256

Multiple Choice

A credit default swap

• A) is essentially the same as an adjustable-rate mortgage.
• B) is essentially the same as insurance against a default.
• C) prevents investors from defaulting on a swap.
• D) allows investors to trade one bad stock for another.

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Definitions:

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A business strategy aimed at achieving the lowest operational costs within an industry to offer products or services at lower prices than competitors.

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Henry Ford

An American industrialist and founder of the Ford Motor Company, who revolutionized factory production with his assembly-line methods.

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