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1. (5 points) Consider the following quotes for Companies A and B: Fixed Rate Floating Rate (6-month LIBOR) LIBOR + 0.5% LIBOR + 1.0% Company

1. (5 points) Consider the following quotes for Companies A and B: Fixed Rate Floating Rate (6-month LIBOR) LIBOR + 0.5% LIBOR + 1.0% Company A Company B 9.0% 10.0% Construct a swap that gives the bank 10 basis points of the margin with the firms splitting the remaining margin equally

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