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ASO can borrow money at either a fixed rate of 7 . 5 % or a variable rate set at prime plus 0 . 5
ASO can borrow money at either a fixed rate of or a variable rate set at prime plus DOT can borrow money at either a variable rate of prime plus or a fixed rate of ASO prefers a fixed rate and DOT prefers a variable rate. Given this information, which one of the folstatements is correct? A after Swap with ASO, DOT should end up Paying fixed rate of about B DOT should end up being the prime rate if they do an interest rate swap with ASO option C both forms will profit if they swap a fixed rate for a prime plus variable rate option D ASO will end up paying no more than as a fixed rate after a swap with DOT option E ASO and DOT cannot swap interest rates in a manner that will be profitable for both firms
ASO can borrow money at either a fixed rate of or a variable rate set at prime plus DOT can borrow money at either a variable rate of prime plus or a fixed rate of ASO prefers a fixed rate and DOT prefers a variable rate. Given this information, which one of the folstatements is correct? A after Swap with ASO, DOT should end up Paying fixed rate of about
B DOT should end up being the prime rate if they do an interest rate swap with ASO
option C both forms will profit if they swap a fixed rate for a prime plus variable rate
option D ASO will end up paying no more than as a fixed rate after a swap with DOT
option E ASO and DOT cannot swap interest rates in a manner that will be profitable for both firms
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