When LIBOR is used as the discount rate:
A. A swap is worth zero immediately after a payment date
B. A swap is worth zero immediately before a payment date
C. The floating rate bond underlying a swap is worth par immediately after a payment date
D. The floating rate bond underlying a swap is worth par immediately before a payment date
C
The value of the floating rate bond underlying an interest rate swap is worth par immediately after a swap payment date. This result is used when the swap is valued as the difference between two bonds.
You might also like to view...
The marketing communications objective of "brand attitude" refers to helping consumers evaluate the brand's perceived ability to meet a currently relevant need
Indicate whether the statement is true or false
The materiality concept implies that if an error is large enough or could effect the decisions of its users, a correction is absolutely necessary
Indicate whether the statement is true or false
Frequently, disputes over violations of administrative rules are resolved through informal adjudication proceedings.
Answer the following statement true (T) or false (F)
In U.S. v. Allmendinger, involving an insurance scam run by Allmendinger and others, Allmendinger received a much longer prison sentence than a co-conspiriator, which he appealed. The appeals court held that a long prison sentence would be overturned due to Allmendinger's cooperation in the investigation of the crime
a. True b. False Indicate whether the statement is true or false