Which of the Following Statements Correctly Describes the Fundamental Principle

Multiple Choice

Which of the following statements correctly describes the fundamental principle of swaps?

A) The parties of the swap each have a comparative advantage in different markets
B) One party may have excess cash while the other party has insufficient cash
C) The parties face the same rates in the same markets, but they have different objectives regarding their payback period
D) One party has an advantage over the other party in all markets and is willing to share that advantage