Which of the Following Is Not a Reason for Financial

question 25

Multiple Choice

Which of the following is not a reason for financial institutions to engage in interest rate swaps?

• A)to reduce interest rate risk
• B)to act as an intermediary
• C)to act as a dealer in swaps
• D)all of the above are reasons for financial institutions to engage in swaps

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Definitions:

Direct Materials

Raw materials that can be directly attributed to the production of specific goods or services and are a significant component of manufacturing costs.

Equivalent Unit

A concept in cost accounting used to apportion costs to partially completed goods, allowing for a more accurate calculation of the cost per unit.

Raw Materials Inventory

Raw Materials Inventory accounts for the cost of materials that have been purchased but not yet processed or used in production on the balance sheet.

Accounts Payable

Accounts payable represent a company's obligation to pay off a short-term debt to its creditors or suppliers.