6.A plain vanilla interest-rate swap to the fixed-rate payer is equivalent to issuing a fixed-rate bond and:

A)   buying a floating-rate bond.

B)   selling a series of interest rate puts.

C)   selling a series of interest rate calls.

D)   buying a forward rate agreement.

7.Which of the following is equivalent to a receive-fixed swap with a tenor of one and a half years with semi-annual swap payments and a fixed rate of 5 percent (exchanged for LIBOR)? Assume that the notional principal is $10,000,000.

A)   A forward rate agreement, which obligates the party to receive a fixed rate of 5% and pay six-month LIBOR on a notional principal of $10,000,000.

B)   A forward rate agreement, which obligates the party to pay a fixed rate of 5% and receive six-month LIBOR on a notional principal of $10,000,000.

C)   A strip of three forward rate agreements, which obligates the party to receive a fixed rate of 5% and pay six-month LIBOR on a notional principal of $10,000,000.

D)   A strip of two forward rate agreements, which obligates the party to receive a fixed rate of 5% and pay six-month LIBOR on a notional principal of $10,000,000.

8.Which of the following is equivalent to a plain vanilla receive fixed currency swap?

A)   A short position in a foreign bond coupled with the issuance of a dollar-denominated floating rate note.

B)   A long position in a foreign bond coupled with a long position in a dollar-denominated floating rate note.

C)   A short position in a foreign bond coupled with a long position in a dollar-denominated floating rate note.

D)   A long position in a foreign bond coupled with the issuance of a dollar-denominated floating rate note.

9.Which of the following is equivalent to a plain vanilla receive-fixed interest rate swap?

A)   A short position in a bond coupled with the issuance of a floating rate note.

B)   A long position in a bond coupled with the issuance of a floating rate note.

C)   A long position in a bond coupled with a long position in a floating rate note.

D)   A short position in a bond coupled with a long position in a floating rate note.

10.Writing a series of interest-rate puts and buying a series of interest-rate calls, all at the same exercise rate, is equivalent to:

A)   a short position in a series of forward rate agreements.

B)   being the fixed-rate payer in an interest rate swap.

C)   being the floating-rate payer in an interest rate swap.

D)   being long a series of bond futures.