Question

    Which of the following statements is correct?

    A. In case of Forward Rate Agreement there is an exchange of interest rate

    B. Forward Rate Agreement is a financial contract between two parties in which the interest for a notional principal amount is exchanged for a specified period with the market interest rate of that time

    A a) Only A Correct Answer Incorrect Answer
    B b) Only B Correct Answer Incorrect Answer
    C c) Both A and B are correct Correct Answer Incorrect Answer
    D d) Both A and B are incorrect Correct Answer Incorrect Answer

    Solution

    The correct answer is B

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