How is a Forward Rate Agreement (FRA) best described?

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Economics · Economy

Verified Solution4 OptionsUpdated: October 2026👁️1 View

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A contract between two parties to lock in an interest rate for a future period on a notional principal

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Answer 1

A contract between two parties to lock in an interest rate for a future period on a notional principal

Answer 2

An obligation to buy financial assets like bonds or shares at a future date

Answer 3

A contract to exchange fixed for floating interest payments

Answer 4

A commitment to buy commodities at a set price in the future

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