The Asset Swap Spread Is

question 12

Multiple Choice

The asset swap spread is

• A)The spread of the fixed rate over current Libor in an interest-rate swap.
• B)The spread over Libor on the floating leg of a swap to exchange the return from a commodity for a floating rate.
• C)The spread over Libor on the floating leg of an interest-rate swap combined with a fixed coupon asset,such that the package is at par.
• D)The spread over Libor on the floating leg of an interest-rate swap combined with a credit default swap,such that the package is at zero value.

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Definitions:

Monocot

A classification of flowering plants (angiosperms) characterized by seeds with a single embryonic leaf or cotyledon.

Secondary Tissues

Plant tissues that arise from secondary growth, including secondary xylem (wood) and phloem, contributing to increased thickness of stems and roots.

Melanin

A dark pigment present in many animals; contributes to the color of the skin.

Lignin

A complex organic polymer deposited in the cell walls of many plants, making them rigid and woody, and contributing to the structural integrity of the plant.