The Option on a Putable Swap Would Most Likely Be

question 25

Multiple Choice

The option on a putable swap would most likely be exercised if interest rates

• A)rise.
• B)fall.
• C)remain constant.
• D)remain somewhat stable.

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Definitions:

Specific Items

Goods or commodities that are distinctly identified and provided in a market or contract.

Excise Taxes

Taxes imposed on specific goods, services, or transactions, often levied on items such as gasoline, tobacco, and alcohol.

Gasoline

A flammable liquid derived from petroleum, used mainly as fuel in most internal combustion engines.

Perfectly Inelastic

A situation where the quantity demanded or supplied of a good is unaffected by changes in its price.