Principle of the comparative advantage
Question 1. Why are interest rate swaps based upon the principle of comparative advantage?Question 2. For a swap to provide a real economic benefit to both parties, why must a barrier generally exist to prevent arbitrage from functioning fully?
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Question 1. Why are interest rate swaps based upon the principle of comparative advantage?
Currency exchange rates are affected by many factors. Determine the effect of the following factors on the rate of currency exchange between 2 countries:
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