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Consider two companies, A and B, that can raise funds either at fixed or floating rates, $100 million over 10 years. Company A wants to
Consider two companies, A and B, that can raise funds either at fixed or floating rates, $100 million over 10 years. Company A wants to raise funds at the fixed rate and Company B wants to raise funds at the floating rate. The market options to raise capital are presented in the following table: Design a fixed-for-floating SWAP between Companies A and B and describe the related cash flows
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