Why Might an Individual or Organization Be Willing to Swap

question 72

Multiple Choice

Why might an individual or organization be willing to swap fixed-rate loans for floating-rate loans?

• A)They may perceive that interest rates are ready to increase
• B)Their cash flows may vary directly with interest rates
• C)Floating rates are lower than fixed rates
• D)They may be able to postpone the payment of principal

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Definitions:

Carbon Tetrabromide

A chemical compound with the formula CBr4, known for its high density and usage in organic synthesis as a solvent or reagent.

Sulfur Trioxide

A chemical compound with the formula SO3, which is a key intermediate in the sulfuric acid manufacturing process, known for its role in acid rain formation when released into the atmosphere.

Dihydrogen Selenide

A chemical compound with the formula H2Se, a colorless, toxic gas with the smell similar to rotten horseradish.

Sulfur Tetrafluoride

A chemical compound with the formula SF4, known for its unique geometry and ability to act as a ligand in coordination complexes.