In a fixed-for-floating currency swap, principal and fixed interest payments in one currency are swapped for the principal and floating rate interest payments in another currency. Select one: True False

In a vanilla interest rate swap:Group of answer choicesthe amounts payable between parties depends on a specified principal that is exchanged at the beginning and at the end.the amounts payable between parties depend on a specified principal that is exchanged at the outset.only interest flows are exchanged until maturity, when the principal is exchanged according to the difference in the interest rates over the lifetime of the swap.one party pays another party an amount calculated according to a floating interest rate on a notional principal, in exchange for an amount calculated on the basis of a fixed interest rate.

Which of the following is true of a floating exchange rate system?Question 4Select one:a.It facilitates automatic trade balance adjustments.b.The European Monetary System adopted a floating exchange rate system prior to 1999.c.It exists when a country fixes the value of its currency relative to a reference currency.d.It provides monetary discipline compared to a fixed exchange rate system.

A swap deal is executed by:Select one:a.Settling the difference int he ratesb.Actual delivery of currenciesc.Entering into another swap deald.None of the above

Which of the following statements is TRUE? Interest rate swaps can be used to: Select one: a. Convert floating rate investments to fixed rate investments b. Convert floating rate debt to fixed rate debt c. Adjust interest rate risk arising in a project or across a business by matching the interest rate sensitivity of interest earned with interest payable d. All of the above

True or false: In a floating exchange rate system, currency values are based on supply and demand in the foreign exchange markets.True false question.TrueFalse