Explain interest rate risk, Operation Management

Assignment Help:

Please give a detailed explanation on the following scenario: You are a swap dealer and know that XYZ County finance director is clueless about how to conduct interest rate risk management. If you pitch a $250,000,000 interest rate swap transaction, your personal take home compensation is $250,000. You know that you can sell the deal based on the fear of future rate increases. However, you also know that if interest rates increase, the county finances are actually better off due to floating rate assets held by the county. Thus, if the deal is done, the county finance director believes there is less interest rate risk based on your sales pitch. However, the county actually has more interest rate risk and you have your $250,000 commission. If the deal is not done, the county has less interest rate risk and you have nothing (but your integrity). What do you do? Please give a detailed explanation.


Related Discussions:- Explain interest rate risk

Describe identified the problem and a technology solution, At this point of...

At this point of the project, you have identified the problem and a technology solution for the business. Now, you want the business to accept the idea. Using your text, the pre

Explain what behaviours destroy trust, Earlier in the class, we noted that ...

Earlier in the class, we noted that communication is the glue holding organizations together. We might say that trust is the "oil" of the organization. With it, processes can opera

What are the chase demand strategies, What are the Chase demand strategies?...

What are the Chase demand strategies? Chase demand strategies: It is just the opposite of a level capacity strategy. The organisation frequently chases customer demand an

Assignment, #question.Opration system of the garments manufacture of bangla...

#question.Opration system of the garments manufacture of bangladesh.

Detrmine the economic order quantity, Question: (a) ‘Stock is often sa...

Question: (a) ‘Stock is often said to be the biggest evil in any business, yet firms still keep stocks.' Discuss the reasons for keeping stocks. (b) Discuss the main c

Explain modern principles of business law, I'm needing a article out of a b...

I'm needing a article out of a book, Modern Principles of Business Law, 1st Edition, 2012. This is my assignment and I dont have book, can someone please help me out, photocopy pag

Explain the impact of the solicitation process, Describe the impact of the ...

Describe the impact of the solicitation process and how it determines the preparation of your bid.

Playground explained in this case study, What does the concept of interacti...

What does the concept of interactive design mean for a service such as the adventure playground described in this case study?

Airbus, 1)?An analysis of type of operations carried out and operating proc...

1)?An analysis of type of operations carried out and operating processes (i.e., project, batch, mass, professional service, service shop,?mass service, etc.) 2)?An identification

Production and Planning Control, A company is setting up an assembly line t...

A company is setting up an assembly line to produce 192 units per eight-hour shift. The following table identifies the work elements, items, and immediate predecessors. Questions:

Write Your Message!

Captcha
Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd