Which of the Following Is NOT a Reason Financial Swaps

question 5

Multiple Choice

Which of the following is NOT a reason financial swaps have become popular contracts?

• A) Swaps provide a clever way of exploiting the theory of comparative advantage.
• B) Swaps exchange cash flows from two different investments and sometimes notional values as well.
• C) Swaps can be warehoused.
• D) Swaps provide a cheap way of transforming cash flows.
• E) A movement from a brokerage business to a dealership market allowed fast and efficient processing of swap agreements.

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Definitions:

Aggrieved Party

An individual or group that has suffered harm or infringement of rights, leading to the filing of a lawsuit or legal claim.

Custom-Made

Products or goods that are specifically designed and made according to the customer's specifications.

Cuffs

The end part of a sleeve, where the material of the garment is turned back or a separate band is sewn on.

Trousers

Clothing items worn from the waist to anywhere between the knees and the feet, covering each leg separately.