Question

In a period when interest rates are expected to rise, _______ institutions will want a fixed-for-floating...

In a period when interest rates are expected to rise, _______ institutions will want a fixed-for-floating swap, and the fixed rate specified on interest rate swaps will be _______ under these conditions.

A. many; lower

B. many; higher

C. few; lower

D. few; higher

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Answer #1

Ans B. many; higher

When the interest rates increase, fixed for floating swap is preferred to save the company from losses. And When the interest rates increase,floating for fixed swap is preferred to save the company from losses.

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