Your company will receive USD10,000,000 in 3 months' time and will keep the funds for a 3-month period to cover a payable 6 months from today. Your analysts think that interest rates may fall from their current level at 6.1% and you want to protect the return you will get until you need the funds. BNP-Paribas, a French bank, offers a FRA with an interest rate of 6% to cover the extra funds for the 3-month period 3 months from today. Your company decides to take the FRA offer from BNP-Paribas. In 3 months, the interest rate in the market is 6.1%.

Match the information to the letters shown in the FRA equation below:

A Answer 1 Choose...

B Answer 2 Choose...

C Answer 3 Choose...

D Answer 4 Choose...

E Answer 5 Choose...

F Answer 6 Choose...

A B D Notational Amount * (SR AR) X days 360 days 1 + SRX 360 ( E