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D Question 1 Suppose a swap bank offers an interest rate swap bid-ask quote of: 4.25% - 4.50%. This means the swap bank will
D Question 1 Suppose a swap bank offers an interest rate swap bid-ask quote of: 4.25% - 4.50%. This means the swap bank will pay a fixed-rate of 4.50% against receiving LIBOR. at these quotes, the swap bank will make a loss of 25 basis points. the swap bank will pay a fixed-rate of 4.25% against receiving LIBOR.
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Fundamentals of Corporate Finance
Authors: Berk, DeMarzo, Harford
2nd edition
132148234, 978-0132148238
