A speculator who feels strongly that short rates will be rising over the next few years might want to be a __________ payer in a swap contract; if she is wrong there is __________ downside risk
A) fixed-rate; no
B) fixed-rate; considerable
C) floating-rate; no
D) floating-rate; considerable
B
You might also like to view...
Opportunity cost can best be defined as the
A. money cost of a good or service. B. money cost plus interest on money borrowed to buy a good or service. C. cost of the resources used to produce a good or service. D. value of the best alternative forgone when the alternative at hand is chosen.
The production possibilities curve bows out because
A) production is efficient. B) of the law of increasing additional cost. C) production is inefficient. D) resources are not being fully utilized.
When a government subsidy is granted to the sellers of a product, buyers can end up capturing some of the benefit because
a. the market price of the product will fall in response to the subsidy. b. the market price of the product will rise in response to the subsidy. c. the market price of the product will not change in response to the subsidy. d. producers will reduce the supply of the product.
The participation rate is the number of people:
A. employed and unemployed divided by the population aged 16 years and older. B. employed divided by the population aged 16 years and older. C. employed and unemployed divided by the labor force. D. employed divided by the labor force.