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Consider two hypothetical companies A and B. Assume that company A wants to raise debt and pay a floating interest rate, which is usually done

Consider two hypothetical companies A and B. Assume that company A wants to raise debt and pay a floating interest rate, which is usually done to finance short-term receivables and credit that earns a short-term interest rate. Company B, conversely, wants long-term fixed ra

Company A

Company B

Floating

LIBOR + 1%

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