(a) Company X has been offered the swap quotes in the following table. It can invest for ten years at 3%. What floating rate can it swap this fixed rate into? Show your work.

(b) Company Y has been offered the swap quotes in the following table. It is confident that it will be able to borrow at LIBOR minus 75 basis points for the next seven years. What fixed rate can it swap this floating rate into? Show your work.

Maturity Bid (%)Offer (%) Swap Rate (%) 2 years 2.55 2.58 2.565 3 years 2.97 3 2.985 4 years 3.15 3.19 3.17 5 years 3.26 3.3 3.28 3.4 3.44 3.42 10 years 3.48 3.52 3.5 7 years Maturity Bid (%)Offer (%) Swap Rate (%) 2 years 2.55 2.58 2.565 3 years 2.97 3 2.985 4 years 3.15 3.19 3.17 5 years 3.26 3.3 3.28 3.4 3.44 3.42 10 years 3.48 3.52 3.5 7 years