Assume the Following Terms for an FRA: Reference Rate Is

question 50

Multiple Choice

Assume the following terms for an FRA: Reference rate is three-month LIBOR, the contract rate is 5.78%, the notional amount is for $10 million, and the number of days to settlement is 91 days. If the settlement rate is 6.33%, what compensation or payment must make to the buyer by the seller?

• A) $13,878
• B) $13,903
• C) $13,684
• D) $13,577

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Definitions:

Head Lice

Parasitic insects that live on human scalps and feed on blood, causing itching and discomfort.

Logical Gap

A flaw or disconnect in an argument where the conclusion does not logically follow from the premises.

Implicit Premise

An underlying assumption that is not explicitly stated but is necessary for an argument's conclusion to be valid.

Implicit Premises

Unstated assumptions that are necessary for an argument to hold together logically, but are not explicitly mentioned.