You Have Sold a $10,000 Notional Cap Consisting of a Single

question 12

Multiple Choice

You have sold a $10,000 notional cap consisting of a single caplet with a strike of 6% for a six-month underlying period.All interest rates are computed based on the 30/360 convention.At maturity of the cap period,the underlying interest rate is 7%.What is the net cash flow to you on maturity?

• A) \(- \$ 50.00\)
• B) \(+ \$ 48.31\)
• C) \(- \$ 48.31\)
• D) \(+ \$ 46.73\)

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Definitions:

Phylogenetic Trees

Diagrams that represent the evolutionary relationships among various biological species or other entities, based upon similarities and differences in their physical or genetic characteristics.

Systematists

Systematists are scientists who study the classification and evolutionary relationships among organisms, organizing them into systems of taxonomy.

Evolutionary Relationships

Descriptions of how different species are connected to each other through common ancestors, detailing the path of divergence and speciation.

Convergent Evolution

A process where organisms not closely related independently evolve similar traits as a result of having to adapt to similar environments or ecological niches.