The US Swap Market Convention, That Is Used to Compute

question 14

Multiple Choice

The US swap market convention, that is used to compute the fixed payments in a USD swap, is

• A) Actual/365.
• B) Actual/360.
• C) Actual/Actual.
• D) 30/360.

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Definitions:

Marginal Cost

An alternative phrasing expressing the additional cost incurred from the production of the next unit of output.

Average Total Cost

The cost per unit is calculated by dividing the overall production cost by the quantity of units produced.

Average Variable Cost

The total variable cost divided by the quantity of output produced; it shows the variable cost per unit of output.

Increasing Returns to Scale

A situation in production where doubling the inputs results in more than doubling the output, leading to efficiencies and economies of scale.