Question #60
Reading: Reading 30 Pricing and Valuation of Forward Commitments
PDF File: Reading 30 Pricing and Valuation of Forward Commitments.pdf
Page: 25
Status: Unattempted
Correct Answer: B
Question
The price of an interest rate swap is the:
Answer Choices:
A. cost to purchase a swap
B. fixed rate of interest
C. market value of the swap
Explanation
The price of an interest rate swap is quoted as the rate on the fixed-rate payments. The
floating rate is a known reference rate but does not need to be quoted.