Which of the Following Statements Is False

question 42

Multiple Choice

Which of the following statements is false?

• A) The swap contract-like forward and futures contracts-is typically structured as a "zero-cost" security.
• B) An interest rate swap is a contract entered into with a bank, much like a forward contract, in which the firm and the bank agree to exchange the coupons from two different types of loans.
• C) In a standard interest rate swap, one party agrees to pay coupons based on a fixed interest rate in exchange for receiving coupons based on the prevailing market interest rate during each coupon period.
• D) If short-term interest rates were to fall while long-term rates remained stable, then short-term securities would fall in value relative to long-term securities, despite their shorter duration.

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Definitions:

Atman

The transpersonal, supreme self, which is the same in everyone. Also see jiva.

Vedas

Ancient sacred scriptures of Hinduism, composed in early Sanskrit and containing hymns, philosophy, and guidance on religious practice.

Anatman

Buddhist doctrine that there is no separate self.

Eternal Atman

The concept in Hindu philosophy of the true self, or soul, which is eternal and transcends the physical body and personal identity.