To Find the Swap Rate for a 3-Year Swap,you Would

question 93

Multiple Choice

To find the swap rate for a 3-year swap,you would

• A)take the arithmetic average of the 1-,2-,and 3-year forward rates.
• B)take the geometric average of the 1-,2-,and 3-year forward rates.
• C)bootstrap the LIBOR yield curve.
• D)none of the options

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Definitions:

FOB

An acronym for "Free On Board," a term used in shipping agreements to indicate that the seller is responsible for the goods until they are loaded onto a vessel at the specified location.

FAS

Generally refers to Financial Accounting Standards, which are guidelines for how financial reports are to be prepared by companies.

Void Title

Not true title; e.g., the title held by someone who knowingly or unknowingly purchased stolen goods.

Stolen Title

The illegal acquisition and possession of a property title or document, often through fraudulent means.