Consider a swap agreement between companies X and Y based on a notional principal of $500 million. X agrees to pay Y an interest rate of 4% per annum on the stated notional principal and Y agrees to pay X the LIBOR rate on the same notional principal. Which of the following statements is correct?

Y is the floating rate payer

X is the floating rate payer

The dollar amount exchanged between the two parties is based on the notional principal as well as the relevant interest rates

X is the fixed rate payer