Question: Describe an interest rate swap and give an example based on the following information. A company with a comparative advantage in the fixed rate market

Describe an interest rate swap and give an example based on the following information. A company with a comparative advantage in the fixed rate market desires a floating rate investment; and vice-versa. A diagram should be used to explain the swap transaction. Explain, in words, why swaps are used to manage the risk of interest rate changes.

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