Company A is the floating-rate payer in an interest rate swap with company B. The...

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Finance

  1. Company A is the floating-rate payer in an interest rate swap with company B. The value of the swap is now negative for company A. Credit and market risk exposures are as follows:

  1. A is exposed to credit risk, A to market risk
  2. A is exposed to credit risk, B to market risk
  3. B is exposed to credit risk, A to market risk
  4. B is exposed to credit risk, B to market risk
  5. Both A and B are exposed to credit and market risk

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