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ABC Co. buys an FRA with an Agreement Rate of 4.25%, a Settlement Rate of 4.85%, a notional amount of$25M, and 93 days in the
ABC Co. buys an FRA with an Agreement Rate of 4.25%, a Settlement Rate of 4.85%, a notional amount of$25M, and 93 days in the FRA period. Did ABC make or lose money? Calculate the settlement amount. Remember to also calculate the present value of the settlement amount. 5
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