An Interest Rate Swap Can Effectively Be Hedged Against Interest

question 83

Multiple Choice

An interest rate swap can effectively be hedged against interest rate risk by:

• A) selling out to another party.
• B) entering into another swap agreement that has the opposite transactions to the first swap.
• C) setting floating-rate obligations equal to fixed-rate obligations.
• D) matching durations of assets and liabilities.

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Definitions:

Enter Credit Card Charges

The process of recording the expenses incurred on a business credit card into the company's accounting system.

Business Transaction

Any activity that involves the exchange of goods, services, or funds between two or more parties.

QuickBooks Company

A specific business entity set up within QuickBooks accounting software to manage its financial transactions and records.

Onscreen Journal

A digital ledger displayed on a screen, used to record financial transactions in accounting software.