When You Are Short a Position in A $3 \times 6$

question 15

Multiple Choice

When you are short a position in a $3 \times 6$ FRA,you are effectively

• A)Long the three-month zero-coupon bond,and long the six-month zero-coupon bond.
• B)Long the three-month zero-coupon bond,and short the six-month zero-coupon bond.
• C)Short the three-month zero-coupon bond,and long the six-month zero-coupon bond.
• D)Short the three-month zero-coupon bond,and short the six-month zero-coupon bond.

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Definitions:

Books Closed

A term referring to the point at which an accounting period is concluded and all financial statements are finalized.

Payday

The day on which an employee receives their salary or wages, typically occurring on a regular basis.

Total Equity

The total net value owned by shareholders, calculated as total assets minus total liabilities.

Traditional Balance Sheet

A financial statement that provides a snapshot of a company's financial condition at a specific point in time, detailing assets, liabilities, and shareholders' equity.