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A Long Cap and a Long Floor with the Exercise

question 49

True/False

A long cap and a long floor with the exercise price set at the swap rate is equivalent to a swap.


Definitions:

Traditional Health Insurance

A type of health insurance that typically involves paying a premium, meeting a deductible, and then paying a percentage of service costs, with many services having a co-pay.

PPOs

Preferred Provider Organizations; a type of health insurance plan that offers members a discount on healthcare services if they use providers in the plan’s network.

Older Workers Benefit Protection Act

A U.S. federal law that provides older workers with protection against age discrimination in benefits and employment practices.

Early-Retirement Waivers

Early-retirement waivers are agreements that allow employees to retire before the traditional retirement age, often with specific benefits or conditions.

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