Analyze a two-year swap agreement to exchange LIBOR for fixed-rate payments on a $100 million notional principal. The first payment will be made in one year; the second in two years. You have the following information on LIBOR rates: One-year spot rate is 3% per year. Forward rate in the second year is 5% per year. a) What must be the annualized two-year spot LIBOR rate? b) Find the floating-rate payments to be made. c) Find the present value of the floating-rate payments. d) Find the fixed rate that would price the swap correctly.