Company A is taking out loans at Libor plus a spread. On January 15, 2002, it takes out a loan of $20 million for one year with quarterly payments on April 12, July 14, October 16, and the following January 14. The underlying rate is 90-day Libor, and Company A will pay a spread of 200 basis points. Interest is based on the exact number of days in the period (convention is actual days/360). Current 90-day Libor is 6.6%. BDI purchases an interest rate cap for $20,000 that has an exercise/strike rate of 6.8% and has caplets expiring on the rate reset dates. (HINT: Actual days for the four periods are 87, 93, 94, and 90) LIBOR Rates 7.150% 12 April 14 July 5.250% 16 October 8.175% Determine the effective interest payments (net of any cap payoffs) on the loan for the next four quarters given the Libor rates as quoted above. Date Libor Loan Days in Period Interest Caplet Payoff Effective Interest Rate Due Payment 15 January 12 April 14 July 16 October 14 January