Fundamentals of Corporate Finance with Connect Access Card
Fundamentals of Corporate Finance with Connect Access Card
11th Edition
ISBN: 9781259418952
Author: Stephen A. Ross Franco Modigliani Professor of Financial Economics Professor, Randolph W Westerfield Robert R. Dockson Deans Chair in Bus. Admin., Bradford D Jordan Professor
Publisher: McGraw-Hill Education
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Chapter 23.5, Problem 23.5CCQ
Summary Introduction

To discuss: The cash flows in the floating for fixed interest rate swap agreement.

Introduction:

Swap contract is an emerging derivative instrument and it is first introduced in the year 1981. The swap contract is an agreement to swap or exchange cash flows at specified intervals. The swap dealer is an important part of the swap market because there is no standardized exchange to swaps like futures. Hence, a swap dealer is any person who makes the market in swaps.

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