The Primary Reasons for a Counterparty to Use a Currency

question 21

Multiple Choice

The primary reasons for a counterparty to use a currency swap are

• A)to hedge and to speculate.
• B)to play in the futures and forward markets.
• C)to obtain debt financing in the swapped currency at an interest cost reduction brought about through comparative advantages each counterparty has in its national capital market, and the benefit of hedging long-run exchange rate exposure.
• D)both a and b

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Definitions:

Surface-level Diversity

Diversity based on visible attributes such as age, race, and gender, rather than deeper qualities like beliefs or values.

Deep-level Diversity

Diversity among team members based on underlying attributes, such as values, beliefs, and attitudes, as opposed to visible characteristics.

Instrumental Values

Values that are considered useful or instrumental in reaching an end goal or desired outcome.

Type A Personality

A temperament characterized by high levels of competitiveness, self-motivation, aggressiveness, and a constant sense of urgency.