If One Party Pays a Fixed Fee on a Regular

question 67

Multiple Choice

If one party pays a fixed fee on a regular basis in return for a contingent payment that is triggered by a downgrading of a firm's credit rating,that is called a

• A)credit option.
• B)credit swap.
• C)credit-linked note.
• D)credit default swap.

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Definitions:

Regulations

Rules or directives made and maintained by an authority, designed to control or govern conduct within specific areas of activity.

Mandates

Instructions or directives given by the electorate to elected officials, or the authority granted to a government or its representatives to govern after an electoral victory.

Federal Agency

Units of the government responsible for the oversight and administration of specific functions, such as the Environmental Protection Agency or the Federal Bureau of Investigation.

Budget

A financial plan outlining expected revenues and expenditures for a specific period, used by individuals, businesses, and governments.