In a plain vanilla interest rate swap, the "fixed-rate payer":
A) has established the price sensitivities of a longer-term fixed-rate liability and a floating-rate asset
B) has established the price sensitivities of a longer-term fixed-rate asset and a floating-rate liability
C) receives fixed in the swap
D) pays floating in the swap

Question

Quizplus · Accepted Answer

In a plain vanilla interest rate swap, the fixed-rate payer pays a fixed interest rate and receives a floating interest rate, which aligns with having a fixed-rate liability and a floating-rate asset.

In a Plain Vanilla Interest Rate Swap, the "Fixed-Rate Payer