Forward Rate Agreements Can Be Used for Speculative Purposes

question 69

Multiple Choice

Forward rate agreements can be used for speculative purposes.If one believes rates will be less than the agreement rate,

• A)take a short position in a forward rate agreement.
• B)the purchase of a FRA is the suitable position.
• C)the sale of a FRA is the suitable position.
• D)take a long position in the spot market.

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