In a Perfectly Matched Hedge of Fixed-Rate Debt Using an Interest

question 8

Multiple Choice

In a perfectly matched hedge of fixed-rate debt using an interest rate swap, the effect of a change in fair value of the derivative on the income statement

• A)is always a gain
• B)may be a gain or a loss
• C)is zero
• D)is always a loss

---

Definitions:

Ballet Troupe

A group of ballet dancers who perform together, often as part of structured productions or tours.

Dyads

A group consisting of two persons, often used in the context of interpersonal relationships, communication studies, and social psychology.

Entitativity

The perception or quality of being a distinct entity, often used in social psychology to discuss how individuals perceive groups as coherent, unified wholes.

Prejudice

Prejudice is a preconceived opinion or judgment toward people or a group without sufficient knowledge, thought, or reason.