Interest Rate Collar Definition.

An interest rate collar is an options strategy that involves the simultaneous purchase of a floor and a ceiling on the interest rate of a security, typically a bond. The floor protects against interest rate decreases, while the ceiling limits the upside potential of the security. The main purpose of an interest rate collar is … Read more

What Is the GDP Price Deflator and Its Formula?

The GDP price deflator is a measure of inflation in an economy. It is calculated by dividing the nominal GDP by the real GDP and multiplying by 100. The resulting number is the percentage change in prices from one period to another. The formula for the GDP price deflator is as follows: GDP Price Deflator … Read more