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Citibank needs to borrow $1 million for 6 months starting in 3 years. Citibank is concerned about the interest rate in 3 years, so they

Citibank needs to borrow $1 million for 6 months starting in 3 years. Citibank is concerned about the interest rate in 3 years, so they entered into a long FRA agreement with BOA. The fixed rate in the FRA is 3% per annum. If the 6 months LIBOR rate proves to be 4% per annum. Please calculate the cash flow to Citibank when they settle the FRA at the end of year 3. Is it a profit or a loss?

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