When an Interest-Only Swap Is Established on an Amortizing Basis

question 71

Multiple Choice

When an interest-only swap is established on an amortizing basis,

• A)the debt service exchanges decrease periodically through time as the hypothetical notational principal is amortized.
• B)the debt service exchanges are the same each year,but the level of interest and principal changes as the loans amortize.
• C)there is no such thing as an amortizing interest-only swap.
• D)none of the options

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