Which of the Following Is Not a Way to Terminate

question 19

Multiple Choice

Which of the following is not a way to terminate a swap:

• A)the two counterparties cash settle the market value
• B)enter into an opposite swap with another counterparty
• C)hold the swap to its maturity date
• D)use a forward contract or option on the swap to enter into an offsetting swap
• E)borrow the notional principal and pay off the counterparty

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Definitions:

Economic Growth

An increase in the production of goods and services over a specific period, often measured by GDP.

Production

The process of creating goods and services through the combination of labor, materials, and capital.

Production Possibilities Frontier

A curve depicting all maximum output possibilities for two goods, given a fixed amount of resources and technology.

Deep Depression

An extended period of significant decline in the economy, characterized by high unemployment, sharp decreases in output and trade, and widespread poverty.