Which of the Following Regarding the Role of a Financial

question 40

Multiple Choice

Which of the following regarding the role of a financial intermediary in an interest rate swap is incorrect?

• A) Most swaps involve a financial intermediary as counterparty.
• B) The financial intermediary will most often seek to engage in an offsetting swap.
• C) The intermediary makes its profit by maintaining a spread between the rates offered to the two counterparties.
• D) The financial intermediary, by establishing a matched swap, ends up with a positive net exposure in the swap market.

---

Definitions:

Inflated Self-Esteem

Excessively high self-regard that does not necessarily align with reality or external assessments.

Natural Light

Illumination provided by sunlight, as opposed to artificial sources like lamps and light fixtures.

Disorder Diagnosis

The process of identifying a disorder based on its symptoms and signs through clinical assessment.

Bipolar Disorders

Mental health conditions characterized by extreme mood swings, including episodes of mania and depression.