1) Why would businesses require to take out Forward Rate Agreements (also known as Future Rate Agreements)? Select one: a. As interest rates become more volatile due their use as a tool of monetary policy it enable the firms to fix the difference between floating and fixed rates of interest in the market. b. As interest rates become more volatile due their use as a tool of monetary policy it enables firms to manage their interest rate risk against increases in interest rates while benefitting from lower interest rates in the market. As interest rates become more volatile due their use as a tool of monetary policy it allows firms to transfer from fixed rates of interest to floating rates of interest. d. As interest rates become more volatile due their use as a tool of monetary policy it allows firms to fix today the rate of interest that will apply to a notional loan or deposit at some future date. 2) The purchase of a FRA gives protect against what? Select one: a. A fall in interest rates b. Both a fall or rise in interest rates A change in the difference between floating rates and fixed rates of interest d. A rise in interest rates