Which of the Following Best Describes a Total Return Swap

question 3

Multiple Choice

Which of the following best describes a total return swap?

• A) It exchanges the realized return on an asset, including both income and capital gains/losses, for a return, equal to LIBOR plus a spread on the initial value of the asset
• B) It exchanges the promised return on an asset, including both income and capital gains/losses, for a return equal to LIBOR plus a spread on the initial value of the asset
• C) It exchanges the realized return on an asset, including income but not capital gains/losses, for a return equal to LIBOR plus a spread on the initial value of the asset
• D) It exchanges the promised return on an asset, including income but not capital gains/losses, for a return equal to LIBOR plus a spread on the initial value of the asset

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Definitions:

Drug Abuse

The misuse of drugs or substances in a way that is harmful to the individual or society.

Children

Young human beings who have not yet reached adulthood or the age of majority.

Marijuana

A psychoactive drug from the Cannabis plant intended for medical or recreational use.

Cocaine

A powerful stimulant drug derived from the leaves of the coca plant, mainly used recreationally for its euphoric effects.