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26 December, 10:25

A guarantee issued by an FI that obligates the FI to pay if the purchaser of the letter defaults on a debt is called a:

A. forward rate agreement.

B. collar.

C. credit swap agreement.

D. loan commitment.

E. None of these options are correct.

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Answers (2)
  1. 26 December, 11:10
    0
    Answer: C. credit swap agreement.

    Explanation:

    A credit default swap (CDS) is a kind of investment where you are mandated to pay someone, so they will pay you in an event where the party involves or company defaults in its payment obligated to you. This is made so because in an event where you are to recive payment and you are defaulted the Fl for you covered.
  2. 26 December, 13:44
    0
    E. None of the options
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Home » Business » A guarantee issued by an FI that obligates the FI to pay if the purchaser of the letter defaults on a debt is called a: A. forward rate agreement. B. collar. C. credit swap agreement. D. loan commitment. E. None of these options are correct.
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