Interest Rate Swaps Can Guarantee That

question 88

Multiple Choice

Interest rate swaps can guarantee that

• A)inflows more closely match outflows.
• B)participants never hold fixed-rate instruments.
• C)participants never hold variable-rate instruments.
• D)all intermediaries will hold both fixed-rate and variable-rate assets.

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Definitions:

Incorporated by Reference

A method in legal documents where the contents of an external document are made a part of the main document by mentioning it explicitly.

Testator

An individual who has made a will or testament to dictate the distribution of their assets after their death.

Testamentary Capacity

The legal and mental ability of an individual to make or alter a valid will, including understanding the nature of the document and the assets.

Prudent Person Rule

A legal principle requiring that a person in charge of others' assets manage those assets with the care, diligence, and judgment that a prudent person would under similar circumstances.