You Bought a CAD 8,000,000

question 506

Multiple Choice

You bought a CAD 8,000,000.00 6x9 FRA at 1.95%. The settlement rate is 3-month (90-day) BBA LIBOR, which is fixed at 0.9500%. What is the settlement amount at maturity?

• A) You pay CAD 20,000.00
• B) You receive CAD 20,000.00
• C) You pay CAD 19,952.61
• D) You receive CAD 19,952.61

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Definitions:

Agriculture Subsidies

Financial assistance provided by the government to farmers and agribusinesses to supplement their income and manage the supply of agricultural commodities.

Social Security

Social Security is a government program that provides financial benefits to retirees, disabled individuals, and their families.

Official Measure

An officially recognized or approved method for determining a fact or figure, often used in statistics or research.

Lorenz Curve

A graphical representation of the distribution of income or wealth within a society, demonstrating inequality.