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Consider the following table of borrowing costs: Me You Fixed 4% 3% Floating LIBOR + 0.3% LIBOR + 0.5% I would like to ultimately be
Consider the following table of borrowing costs: Me You Fixed 4% 3% Floating LIBOR + 0.3% LIBOR + 0.5% I would like to ultimately be a fixed-rate borrower, and you would like to ultimately be a floating-rate borrower. Give an example of a swap that would be mutually beneficial for us. Demonstrate carefully why the swap is mutually beneficial, and be specific about who is the pay-fixed party and who is the receive-fixed party in the swap. Note: there are an infinite number of correct answers. You need to provide only one. Consider the following table of borrowing costs: Me You Fixed 4% 3% Floating LIBOR + 0.3% LIBOR + 0.5% I would like to ultimately be a fixed-rate borrower, and you would like to ultimately be a floating-rate borrower. Give an example of a swap that would be mutually beneficial for us. Demonstrate carefully why the swap is mutually beneficial, and be specific about who is the pay-fixed party and who is the receive-fixed party in the swap. Note: there are an infinite number of correct answers. You need to provide only one
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