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Assume the Following Terms for an FRA: Reference Rate Is

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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?


Definitions:

Relative Area

A term that describes the proportion or percentage of a specific area with respect to a larger reference area, often used in analytical techniques.

Multiplicity

In NMR spectroscopy, multiplicity indicates the number of nearby nonequivalent hydrogen atoms influencing a given hydrogen atom's resonance, revealing its splitting pattern.

Relative Ratio

A term used to describe the proportional relationship between quantities or concentrations of substances.

Peak

A term often used in spectroscopy and chromatography to describe the highest point in a graph representing the presence or concentration of a substance.

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