Interest rate and currency swaps allow one party to exchange a:
A) floating interest rate or currency value for a fixed interest or value over the contract term.
B) fixed interest rate or currency value for a lower fixed value over the contract term.
C) floating interest rate or currency value for a lower floating value over the contract term.
D) a fixed interest rate position for a currency position over the contract term.

Question

Quizplus · Accepted Answer

Interest rate and currency swaps typically involve the exchange of a floating interest rate or currency value for a fixed interest rate or currency value over the term of the contract. This allows parties to hedge against interest rate or currency fluctuations.

Interest Rate and Currency Swaps Allow One Party to Exchange