When LIBOR Is Used as the Discount Rate

question 11

Multiple Choice

When LIBOR is used as the discount rate

• A)The value of a swap is worth zero immediately after a coupon payment
• B)The value of a swap is worth zero immediately before a coupon payment
• C)The value of the floating rate bond underlying a swap is worth par immediately after a coupon payment
• D)The value of the floating rate bond underlying a swap is worth par immediately before a coupon payment

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Definitions:

Evolutionary Psychology

A theoretical approach that examines mental traits such as memory, perception, and language from the perspective of human evolution and natural selection.

Explanations

Reasonings given to clarify how or why something happens or is done, providing understanding into the cause-and-effect relationships or mechanisms behind events.

Evolutionary Psychology

A theoretical approach in psychology that explains human thoughts and behaviors as adaptations, evolved to solve problems of survival and reproduction.

Evolutionary Psychology

A theoretical approach in psychology that seeks to explain mental and psychological traits—such as memory, perception, or language—as adaptations, i.e., as the functional products of natural selection.