The Primary Purpose of Interest Rate Swaps Is to Reduce

question 38

True/False

The primary purpose of interest rate swaps is to reduce exchange rate risk.

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Definitions:

Normal Goods

Goods for which demand increases as the income of consumers increases, assuming all other factors remain constant.

Natural Gas

A fossil fuel consisting mainly of methane, used primarily for heating, cooking, and electricity generation.

Heating Oil

A low viscosity, liquid petroleum product used as a fuel for furnaces or boilers in buildings.

Demand Curve

A graph depicting the relationship between the price of a good and the quantity demanded by consumers.