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Identify the correct statement regarding an interest rate swap. A. There is no default risk involved in a swap. B. The net settlement is a

  1. Identify the correct statement regarding an interest rate swap.

    A.

    There is no default risk involved in a swap.
    B.

    The net settlement is a single payment at the end of the swap term.
    C.

    The fixed-rate payments are set equal to the expected floating-rate payments.
    D.

    The flow of payments between parties may change direction during the life of the swap.

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