Interest Rate Risk And Swap
Interest-rate risk is the possibility that changes in market interest rates will alter a company’s borrowing cost, investment income, asset value, liability value, or cash flow. The original discussion correctly treats this risk as especially important for multinational enterprises because they borrow in several currencies, use different maturities, and may combine fixed- and floating-rate debt. It also identifies forward-rate agreements, futures, swaps, and refinancing as methods of managing exposure. These

