DVR Inc. can borrow dollars for five years at a coupon rate of 2.90 percent. Alternatively, it can borrow yen for five years at a rate of 1.00 percent. The five-year yen swap rates are 0.790.70 percent and the dollar swap rates are 2.562.59 percent. The currency /$ exchange rate is 87.650. Determine the dollar AIC and the dollar cash flow that DVR Inc. would have to pay under a currency swap where it borrows 1,750,000,000 and swaps the debt service into dollars.

Borrow
Swap