A "Fixed for Floating" Interest Rate Swap Is Also Referred

question 7

Multiple Choice

A "fixed for floating" interest rate swap is also referred to as:

• A)plain vanilla
• B)fixed swap
• C)currency swap
• D)plain swap

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Definitions:

IRR

Internal Rate of Return, a financial metric used to evaluate the profitability of potential investments.

Depreciation

The systematic allocation of the cost of a tangible asset over its useful life, reflecting its consumption, wear and tear, or obsolescence.

Tax Impact

The effect of taxation on an individual's or company's financial situation, including tax liabilities and planning.

Incremental Cash Flow

Incremental cash flow is the additional cash flow a company receives from taking on a new project or investment, used to assess its profitability.