A Swap Is an Arrangement for Two Counterparties To

question 30

Multiple Choice

A swap is an arrangement for two counterparties to:

• A)exchange cash flows over time.
• B)permit fluctuation in interest rates.
• C)help exchange markets clear.
• D)temporarily exchange fixed assets.
• E)insure natural catastrophes.

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Definitions:

Straight Line Amortization

A technique for uniformly distributing the expense of an intangible asset across its lifespan.

Voting Shares

Securities affording the owner the ability to vote on important company decisions, including who gets elected to the board.

IAS 36

An International Accounting Standard that prescribes the procedures for accounting for impairments of assets.

Amortized

The gradual reduction of a debt or capital cost over a period, especially through regular payments covering interest and part of the principal.