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:

Paronychia

An infection of the skin around a fingernail or toenail, often appearing red and swollen and can be painful.

Pressure Ulcer

Localized damage to the skin and/or underlying tissue, usually over a bony prominence, as a result of pressure or pressure in combination with shear.

Eschar

A dry, dark scab or falling away of dead skin, typically resulting from a burn or wound.

Subcutaneous Tissue

The layer of tissue lying just below the dermis of the skin, containing fat and connective tissues that insulate and protect the body.