1. Bank of America enters into a 3-year plain vanilla SWAP contract with AllState Insurance. The notional value of the contract is $100 million Bank of America agrees to pay a fixed rate of interest of 3%, while AllState will pay LIBOR+1%. Payments will be settled at year-end during the next three years. Assume the following year-end LIBOR rates: Year 1: LIBOR-3% Year 2: LIBOR - 3.5% Yea 3: LIBOR - 2% Fire 1. Bank of America enters into a 3-year plain vanilla SWAP contract with AllState Insurance. The notional value of the contract is $100 million Bank of America agrees to pay a fixed rate of interest of 3%, while AllState will pay LIBOR+1%. Payments will be settled at year-end during the next three years. Assume the following year-end LIBOR rates: Year 1: LIBOR-3% Year 2: LIBOR - 3.5% Yea 3: LIBOR - 2% Fire