An Advantage of a ____ Over Other Interest Rate Swaps

question 30

Multiple Choice

An advantage of a ____ over other interest rate swaps is that the fixed-rate payer has the flexibility to avoid exchanging future interest payments.

• A)callable swap
• B)putable swap
• C)zero-coupon-for-floating swap
• D)forward swap

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Definitions:

Contribution Margin

The amount by which the sale of a product or service exceeds its variable costs, contributing to covering fixed costs and generating profit.