The floating-rate payer in a simple interest-rate swap has a position that is equivalent to: A. issuing a floating-rate bond and a series of long FRAs. B. a series of long forward rate agreements (FRAs). C. a series of short FRAs.
The floating-rate payer has a liability/gain when rates increase/decrease above the fixed contract rate; the short position in an FRA has a liability/gain when rates increase/decrease above the contract rate.
