CB Solutions. Heather O'Reilly, the treasurer of CB Solutions, believes interest rates are going to rise, so she wants to swap her future floating$-$rate interest payments for fixed rates. Presently, she is paying per annum on $$5,100,000$ of debt for the next two years, with payments due semiannually. LIBOR is currently $3\mathrm{.}987\%$ per annum. Spread paid over LIBOR, per annum is $2\mathrm{.}000\%.$ Heather has just made an interest payment today, so the next payment is due six months from now. Heather finds that she can swap her current floating$-$rate payments for fixed payments of $7\mathrm{.}002\%$ per annum. $($CB Solutions' weighted average cost of capital is $12\%,$ which Heather calculates to be $6\%$ per $6-$month period, compounded semiannually$).$

a$.$ If LIBOR rises at the rate of $50$ basis points per $6-$month period, starting tomorrow, how much does Heather save or cost her company by making this swap?

b$.$ If LIBOR falls at the rate of $25$ basis points per $6-$month period, starting tomorrow, how much does Heather save or cost her company by making this swap?

a$.$ If LIBOR rises at the rate of $50$ basis points per $6-$month period, starting tomorrow, how much does Heather save or cost her company by making this swap?

The swap $$ for the first six$-$month period is : $($Select from the drop$-$down menu and round to the nearest dollar.$)$

The swap $(1)$ for the second six$-$month period is $ $($Select from the drop$-$down menu and round to the nearest dollar.$)$

The swap $(2)$ for the third six$-$month period is $ $($Select from the drop$-$down menu and round to the nearest dollar.$)$

The swap $(3)$ for the fourth six$-$month period is $ $($Select from the drop$-$down menu and round to the nearest dollar.$)$

b$.$ If LIBOR falls at the rate of $25$ basis points per $6-$month period, starting tomorrow, how much does Heather save or cost her company by making this swap?

The swap $(4)q,$

$$ for the first six$-$month period is $ $($Select from the drop$-$down menu and round to the nearest dollar.$)$

The swap $(5)$ for the second six$-$month period is $ $($Select from the drop$-$down menu and round to the nearest dollar.$)$

The swap $(6)$ for the third six$-$month period is $ $($Select from the drop$-$down menu and round to the nearest dollar.$)$

The swap $(7$ for the fourth six$-$month period is $ $.($Select from the drop$-$down menu and round to the nearest dollar.$)$

$(1)$ cost $(2)$ cost

$(3)$ cost

$(4)$ cost

$(5)$

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$$ savings savings savings savings

$(6)$

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$(7)$ cost savings savings $$ savings