A Pay-Fixed Interest Rate Swap Can Be Viewed as Equivalent

A pay-fixed interest rate swap can be viewed as equivalent to

A) a long position in a par-valued FRN and a long position in a par-valued, fixed-rate note.
B) a long position in a par-valued FRN and a short position in a par-valued, fixed-rate note.
C) a short position in a par-valued FRN and a long position in a par-valued, fixed-rate note.
D) a short position in a par-valued FRN and a short position in a par-valued, fixed-rate note.
E) a flat position in a par-valued FRN and a short position in a par-valued, fixed-rate note.

Correct Answer:

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