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As CEO of TX Instruments you are considering financing your Australian operations with debt. US 10. year treasuries are currently at 2.5% and Australian 10-year

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As CEO of TX Instruments you are considering financing your Australian operations with debt. US 10. year treasuries are currently at 2.5% and Australian 10-year treasuries are at 5.0%. You can borrow at 4.25% domestically (175 bp over the US 10 yeaf treasury) or at 7.25% (225 bp over the Australian treasury) in Australian dollars. Assume that there exists an Australian company that can borrow at 100 bp over the Australian treasury and at 125 bp over the US treasury. What is your Quality Spread Differential (QSD) in basis points? QUESTION 2 Same setting (see below), if the swap bank charges 25 basis points, and the TX Instruments and the Australian Company split the remaining QSD evenly, how much does TX Instruments save? As CEO of TX Instruments you are considering financing your Australian operations with debt. US 10- year treasuries are currently at 2.5% and Australian 10-year treasuries are at 5.0%. You can borrow at 4.25% domestically (175 bp over the US 10 year treasury) or at 7.25% (225 bp over the Australian treasury) in Australian dollars. Assume that there exists an Australian company that can borrow at 100 bp over the Australian treasury and at 125 bp over the US treasury. What is your Quality Spread Differential (OSD) in basis points? Click Save and Su ubmit to save and submit. Click Save All Answers to save all answers

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