Question 1

A swap can be thought of as a:

Accepted Answer

A)  Package of forward contracts. 
B)  Package of futures contracts. 
C)  Package of options. 
D)  a and c only. 
E)  None of the above. 
A)  Package of forward contracts. 
B)  Package of futures contracts. 
C)  Package of options. 
D)  a and c only. 
E)  None of the above.

Question 2

Debt instruments created by using swaps are commonly referred as structured notes.

Accepted Answer

A) True 
 B)False

Question 3

The dollar amount of the payments exchanged in a swap agreement is based on some predetermined dollar principal, which is called:

Accepted Answer

A)  The principal. 
B)  The notional amount. 
C)  The maturity value. 
D)  The par value. 
E)  None of the above. 
A)  The principal. 
B)  The notional amount. 
C)  The maturity value. 
D)  The par value. 
E)  None of the above.

Question 4

When the seller agrees to pay the buyer if a designated reference falls below a predetermined level, the agreement is called:

Accepted Answer

A)  A swap. 
B)  A cap. 
C)  A floor. 
D)  The strike. 
E)  None of the above. 
A)  A swap. 
B)  A cap. 
C)  A floor. 
D)  The strike. 
E)  None of the above.

Question 5

A cap and a floor can be viewed simply as:

Accepted Answer

A)  A package of forwards. 
B)  A package of options. 
C)  A package of futures. 
D)  A complex contract. 
E)  None of the above. 
A)  A package of forwards. 
B)  A package of options. 
C)  A package of futures. 
D)  A complex contract. 
E)  None of the above.

Question 6

The swap market is now more liquid than many forward contracts, particularly long-dated forward contracts.

Accepted Answer

A) True 
 B)False

A swap can be thought of as a:

Debt instruments created by using swaps are commonly referred as structured notes.

The dollar amount of the payments exchanged in a swap agreement is based on some predetermined dollar principal, which is called:

When the seller agrees to pay the buyer if a designated reference falls below a predetermined level, the agreement is called:

A cap and a floor can be viewed simply as:

The swap market is now more liquid than many forward contracts, particularly long-dated forward contracts.

Introduction

Overview of Market Participants and Financial Innovation

Depository Institutions

Insurance Companies

Asset Management Firms

Investment Banking Firms

Primary and Secondary Markets

Risk and Return Theories: I

Risk and Return Theories: II

Introduction to Financial Futures Markets

Introduction to Options Markets

Common Stock Market: I

Common Stock Market: II

Stock Options Market

The Market for Stock Index Products and Other Equity Derivatives

The Theory and Structure of Interest Rates

Valuation of Debt Contracts and Their Price Volatility Characteristics

The Term Structure of Interest Rates

Money Markets

Treasury and Agency Securities Markets

Corporate Senior Instruments Markets: I

Corporate Senior Instruments Markets: II

Municipal Securities Markets

The Residential Mortgage Market

The Market for Residential Mortgage-Backed Securities

Market for Asset-Backed Securities

Market for Commercial Mortgage Loans and Commercial Mortgage-Backed Securities

International Bond Markets

International Bond Markets

Market for Interest Rate Risk Transfer Vehicles: OTC Instruments

The Market for Foreign Exchange and Risk Control Instruments

Filters

Exam 12: Introduction to the Swaps, Caps, and Floors Markets

A swap can be thought of as a:

Debt instruments created by using swaps are commonly referred as structured notes.

The dollar amount of the payments exchanged in a swap agreement is based on some predetermined dollar principal, which is called:

When the seller agrees to pay the buyer if a designated reference falls below a predetermined level, the agreement is called:

A cap and a floor can be viewed simply as:

The swap market is now more liquid than many forward contracts, particularly long-dated forward contracts.

Introduction

Overview of Market Participants and Financial Innovation

Depository Institutions

Insurance Companies

Asset Management Firms

Investment Banking Firms

Primary and Secondary Markets

Risk and Return Theories: I

Risk and Return Theories: II

Introduction to Financial Futures Markets

Introduction to Options Markets

Common Stock Market: I

Common Stock Market: II

Stock Options Market

The Market for Stock Index Products and Other Equity Derivatives

The Theory and Structure of Interest Rates

Valuation of Debt Contracts and Their Price Volatility Characteristics

The Term Structure of Interest Rates

Money Markets

Treasury and Agency Securities Markets

Corporate Senior Instruments Markets: I

Corporate Senior Instruments Markets: II

Municipal Securities Markets

The Residential Mortgage Market

The Market for Residential Mortgage-Backed Securities

Market for Asset-Backed Securities

Market for Commercial Mortgage Loans and Commercial Mortgage-Backed Securities

International Bond Markets

International Bond Markets

Market for Interest Rate Risk Transfer Vehicles: OTC Instruments

The Market for Foreign Exchange and Risk Control Instruments

Filters